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FCA consultation on enabling direct dealing
The FCA is consulting industry on proposals to implement direct dealing. CP25/18 is open until 21 November. See more here.
Direct2Fund ('D2F') is the optional, alternative investor-fund dealing model for UK funds.
D2F enables investors to transact directly with their desired investment fund, bypassing the Authorised Fund Manager (AFM). The AFM has traditionally acted as a counterparty between investors and the funds they offer.
Removing the AFM from the chain:
- Replicates as much as possible the model operated in a number of non-UK fund domiciles (such as Luxembourg and Ireland);
- Eliminates completely the small risk of loss to the investor arising from a failure of the AFM (and remove the majority of the applicability of CASS);
- Bolsters the competitiveness of the UK investment management industry and delivers the best possible outcome for investors, business and the UK economy.
Adoption of the D2F model is intended to be optional and can run alongside the existing model.
Visual comparison
Publications
The FCA consultation, dated October 2025, include:
• Rules and guidance for an alternative, streamlined dealing model for conventional and tokenised authorised funds, referred to as ‘direct to fund’ (D2F). D2F has wider application than just to tokenised funds, but we think allowing this new dealing model will enable tokenisation.
• Guidance for operating a tokenised fund under the Blueprint model.
D2F Explainer, from September 2025, provides an at-a-glance visual comparison of the conventional dealing model and D2F, alongside a basic overview and the scenarios in which the model may not be appropriate.
Regulatory & Legal Analysis, dated May 2023 - an executive summary of the regulatory changes that may be necessary to implement D2F
Contact
John Allan | Head of Innovation and Operations Unit
