FCA policy director David Geale says the watchdog’s role is not to “please everyone” but to ensure consumers get suitable advice for defined benefit transfers.
The statement says opinions were divided on a ban, with a small majority of respondents arguing against it.
The regulator says it is difficult to show a direct link between unsuitable advice and firms using contingent charging models.
Speaking to Money Marketing, Geale points out contingent charging is a sensitive topic and so the FCA must consider any intervention carefully.
But he also indicates the FCA will not hesitate to intervene if it finds there is evidence contingent charging is detrimental to consumers.
He says: “First things first it is not our role to please everybody. Our job is to ensure consumers get suitable advice.
“If we find through further work there is evidence linking contingent charging to unsuitable advice then we will act but it has to be in a balanced way.
“There is no silver bullet and that is why we do not think diving into a ban would be a good idea.”
The statement says the watchdog will consider changes to rules where appropriate and consult on any new proposals in the first half of 2019.