For decades, retail investors have been largely shut out of the corporate bond market, with even access to government bonds (Gilts) limited. This exclusion has not only restricted investor choice but also constrained the depth and diversity of capital available to issuers.
Now, both regulatory momentum and private sector innovation are beginning to change that. Winterflood Securities, a long-standing advocate for greater market access, is at the forefront of this shift.
“The FCA is committed to tackling societal harm caused by people not having access to appropriate financial products,” explains Michael Smith of Winterflood. “Corporate bond access has been a clear focus area, and regulatory changes due later this year will make it easier for both retail investors and issuers to engage in the market.”
Winterflood anticipated this shift several years ago. “We saw this direction of travel over three years ago and began actively championing retail inclusion,” says Smith. “The debate over whether retail should be involved is behind us – the focus now is on how to redesign a system built for wholesale participation.”
Since our first primary market gilt transaction, we’ve seen volumes rise by 265%
To test retail demand and operational feasibility, Winterflood launched a pilot to enable access to new issue UK Gilts through digital channels for intermediaries such as wealth managers and execution-only platforms. Gilts, already somewhat accessible to the public, provided a practical entry point.
The market response has been notable. Winterflood’s secondary fixed income trading volumes rose from £9.5bn in 2022 to £15.5bn in 2023 – an increase of 63% – and reached £17bn in 2024. This growth signalled that Gilts were firmly on the radar of retail investors.
In February 2024, Winterflood partnered with the UK Debt Management Office (DMO) and other Gilt-Edged Market Makers (GEMMs) to enable retail participation in the first of nine different Gilt issues, including both fixed-rate and inflation-linked bonds.
We’ve shown it’s not only possible to bring retail into primary issuance, but also to support transparency, price discovery and post-issuance liquidity
“Since our first primary market gilt transaction, we’ve seen volumes rise by 265%,” Smith notes. “We can see anonymised, granular data on the number and size of retail orders across the market. Yet we settle with just a few intermediaries – wealth managers or platforms – so neither we nor the issuer interacts directly with individuals. That’s key to operational scalability.”
This retail-ready infrastructure is timely. With regulatory reforms expected later this year to support retail participation in the corporate bond market, the Gilt pilot offers a working model for broader implementation. The initiative aligns closely with efforts by the Financial Conduct Authority and HM Treasury to modernise UK capital markets and make them more inclusive.
“Our goal is to reconnect retail investors with the fixed income markets,” Smith concludes. “We’ve shown it’s not only possible to bring retail into primary issuance, but also to support transparency, price discovery and post-issuance liquidity.”
Winterflood’s pioneering approach may soon be the foundation for a more inclusive, accessible corporate bond market – one where individual investors stand alongside institutions as equal participants in the UK’s financial future.