The UK government and the Financial Conduct Authority (FCA) are determined to intervene on behalf of the 16 million people living in Britain who need financial advice but cannot afford it.

The decision comes after Britain's financial watchdog and the government completed a review aimed at helping people currently stuck in a so-called "advice gap" – those who have money to invest but cannot afford the services of professional wealth management firms.

"A clear need for intervention by the regulator and the government to help both consumers and industry benefit from new and more cost-effective ways of delivering high quality advice and guidance," the FCA and the Treasury said in a statement released on Monday (14 March).

The report follows a separate investigation from the watchdog, which found that over the past nine years the percentage of retail investment products purchased in Britain without customers taking professional advice has increased from 33% to 66%.

A number of financial advisers have defended themselves by pointing out they can no longer take on less wealthy clients after being banned in 2013 from offering allegedly "free" advice, which was in fact funded commissions from product providers.

However, the FCA and the Treasury said they would work on regulatory changes that would make "streamlined advice" available to less wealthy customers. The report also laid out plans to ensure advisers would offer investment services to customers without going as far as offering personal recommendations.

"We know that people often find it difficult to engage with financial matters and we need to make it easier for them to do so," said Tracey McDermott, FCA acting chief executive.

"The package of reforms we have laid out today will help increase both the accessibility and affordability of the advice and guidance to ensure that consumers get the help they really need when they really need it."

According to the regulator's estimates, some 2,000 advisers left the industry in 2013, following a seven-year review which demanded wealth managers were better qualified and that firms charged transparently for advice.