On 12 March 2026, the European Securities and Markets Authority (ESMA) published its report on the retail investor journey. The report follows an ESMA call for evidence (CfE) that sought to gather stakeholder input on key aspects of the investor experience, with a particular focus on the investor protection requirements under the Markets in Financial Instruments Directive II (MiFID II). The report consists of a discussion of the feedback ESMA received, as well as an outline of different areas where further engagement may be warranted.

ESMA’s report should be read within the context of the European Commission’s (Commission) Savings and Investment Union (SIU) initiative. Through different legislative and non-legislative initiatives listed under the March 2025 SIU Action Plan, the Commission aims to create more integrated EU capital markets and channel more savings towards investments to finance the EU’s climate and competitive transition. In addition, the European Parliament and the Council reached a compromise on the text of the Retail Investment Strategy (RIS) in December 2025 and formal adoption and publication of the legal texts is expected later this year. The findings of the ESMA CfE will inform the European Supervisory Authority when developing technical advice on initiatives aimed at enhancing retail participation in EU capital markets.

Barriers to retail investment

Chapter 3 of the report provides an overview of the feedback that ESMA received. The chapter provides an overview of the key barriers respondents identified, as well as proposed measures to remove them. The main takeaways are set out below.

  • Non-regulatory barriers: CfE respondents held divergent views on the principal non-regulatory obstacles to retail investment in the EU. Consumer organisations cited low market trust, high fees, and limited product comparability, while industry participants emphasised insufficient financial literacy, regulatory complexity, and cultural or behavioural considerations. Another group of stakeholders noted that the weight of these factors differs across Member States. Suggested remedies include strengthening financial education, streamlining regulatory requirements, reforming pension frameworks to incentivise capital markets participation, and implementing tax reforms.
  • Speculative and volatile investments among young investors: Respondents broadly agreed that younger investors show a marked tendency towards speculative and volatile products, motivated by expectations of high investment returns, social media influence, accessibility, and the perception of lower costs. A lack of confidence in traditional financial institutions and an inclination towards decentralised products were also identified as relevant factors. Recommendations include enforcing compliance by financial influencers with EU and national requirements, robust application of the Markets in Crypto-Assets Regulation (MiCA) framework, and expanding the investment options available to younger investors.
  • Disclosures: Disclosure as a principle commands broad support among respondents. However, respondents considered its practical impact to be weakened by the sheer volume, complexity, fragmented nature, and technical language of the information provided. Some existing requirements were viewed as inadequately adapted to the digital environment. Opinions on the utility of the Key Information Document (KID) varied. Several respondents considered MiFID II costs and charges disclosures to be unnecessarily complex, limiting their comprehensibility for retail investors.
  • Anti-money laundering (AML) and counter-terrorist financing (CTF): AML and CTF requirements are not widely regarded as an impediment to retail investment in the EU. Nonetheless, respondents flagged inconsistencies in firms’ implementation practices, leading to duplicative information requests and inadequate communication to retail investors regarding the purpose of such requests. Several respondents advocated for the further harmonisation of AML and CTF standards at EU level.
  • Tax: Both direct and indirect tax-related obstacles to retail investment growth were identified. Direct barriers stem from disparities in taxation and reporting requirements across EU jurisdictions, whilst indirect barriers relate to jurisdiction-specific tax incentives favouring particular products. Recommendations include simplifying and harmonising tax and reporting obligations, issuing clear guidance on cross-border tax requirements for retail investors, and creating an EU Savings and Investment Account to support cross-border retail investment.
  • Regulatory disclosures and marketing material: Only a few parties responded to the questions under this section of the CfE, which focused on whether industry practices provide transparent and meaningful information to investors and whether certain marketing and contractual documentation create unintended barriers to informed investment decisions. The respondents that did provide feedback mentioned the feeling that there is an overload of information coming from disclosures, contracts and marketing information, which does not support retail investors in easily digesting the information. Firms could take steps to make contracts and terms and conditions more accessible by using plain language and visualisation, and by conducting user testing before implementing any changes to their documentation.
  • Suitability assessment: The suitability assessment is recognised as a fundamental safeguard, yet respondents viewed it as administratively onerous and time-intensive for clients. Firms reported difficulties in keeping client information current, with the incorporation of sustainability preferences adding a further layer of complexity. Proposals include finalising the Sustainable Finance Disclosure Regulation review to bring greater clarity to product categories and aligning them with the suitability-preference framework, alongside simplifying the collection and updating client preferences.
  • Appropriateness assessment for non-advised services: The appropriateness assessment enjoys widespread support among respondents, who agree that it serves to enhance retail investors’ awareness of product-related risks without materially impeding access to investment services.
  • Crowdfunding: Respondents highlighted that retail investors engaging in crowdfunding projects tend to underestimate the frequently high-risk and illiquid nature of crowdfunding investments. They propose to address the issue by improving the quality of disclosures accompanying crowdfunding projects and by enhancing crowdfunding service providers’ due diligence on project owners to reduce the risk of fraud.
  • Other topics: A recurring theme was that the current regulatory framework is excessively oriented towards investor protection at the expense of client choice, with respondents advocating a more proportionate balance between risk and reward. Several industry participants further emphasised the importance of regulatory stability in fostering investor confidence.

Follow-up actions

The final chapter of the report sets out how ESMA intends to utilise the outcomes of the CfE in its future work programme. In particular, it will draw upon stakeholder recommendations in developing its technical advice under the RIS. Among other planned actions, ESMA intends to streamline disclosure requirements through its Level 2 work by enhancing the clarity and timing of disclosures, calibrating periodic reporting obligations, and promoting a digital-first approach. ESMA will also update its Level 2 and Level 3 measures on suitability and appropriateness, encouraging the wider adoption of digital tools and exploring further proportionality measures for simpler products and distribution models.