Facilitating E-Delivery While Preserving Investor Choice
By Robert Cook, President and CEO, FINRA
As part of FINRA Forward’s rule modernization initiative, FINRA’s Board recently approved updates to FINRA’s requirements for how broker-dealers deliver investor notices, disclosures, and other communications that are mandated by FINRA rules. Once effective, these updates would permit member firms to make e-delivery their default delivery method, while preserving the ability of investors to choose paper delivery.
The Current Delivery Framework and Subsequent Developments
The federal securities laws and FINRA rules have long made paper the default method for delivering required customer communications. In the 1990s, with the emergence of the internet and electronic communications, the SEC and FINRA modernized their requirements to enable e‑delivery. Importantly, because online communication was relatively new at that time and not everyone had access, this regulatory framework generally permitted e-delivery only when a customer affirmatively elected to receive communications electronically.
The world now looks much different. In the decades that have passed since this framework was created, we have seen rapid technological advancements, and the vast majority of Americans, across all age groups, now use the internet. Investors can access information about their securities accounts at any time via firm websites and apps. Attitudes also have changed. As recently as 10 years ago, a plurality of investors preferred to receive paper disclosures. Today, the latest research shows that many investors now prefer e-delivery over physical delivery. For example, data from the FINRA Foundation’s National Financial Capability Study, released in December 2025, indicate that email is investors’ most popular method for receiving disclosures.
Communications related to retirement plans and Social Security benefits have already shifted towards e‑delivery as the default. In 2020, the Department of Labor (DOL) adopted a rule to move private employers’ retirement plan communications to e-delivery, while retaining a paper delivery option. DOL estimated that the shift would save retirement plans billions of dollars. The federal government’s Thrift Savings Plan—a retirement plan with millions of participants—also delivers statements electronically by default for participants who have set up an online account or provided an email address. In addition, the Social Security Administration started phasing out paper annual beneficiary statements more than a decade ago to focus on providing online statements.
Most recently, in December 2025, the U.S. House of Representatives passed bipartisan legislation that would direct the SEC and self-regulatory organizations, including FINRA, to promulgate rules to provide for e‑delivery as the default.
E-Delivery Can Benefit Member Firms and Investors
Shifting the default to e-delivery—while preserving the ability of individuals to receive paper delivery if they so choose—can benefit both member firms and investors. E-delivery allows customers to receive more timely information about their accounts than with communications that are printed and mailed. E‑delivery also reduces paper usage and waste and eliminates paper-related printing and mailing costs.
Mailing sensitive information can expose customers to risks from bad actors who steal mail for financial gain. The U.S. Postal Inspection Service has reported that mail theft has increased significantly in recent years primarily due to financially motivated crimes. Safeguards such as multi-factor authentication, encryption, and firm surveillance to detect unusual or suspicious account patterns help protect sensitive information delivered to customers electronically.
Furthermore, many firms are continually developing innovative techniques to convey information electronically in ways that are more intuitive and accessible, potentially helping investors to better understand that information. Allowing firms to utilize e-delivery more frequently and consistently will support further investments in and adoption of these innovative approaches. This in turn will facilitate the core regulatory objectives underlying information delivery requirements; investors are better served when they receive information in a format that is more readily digestible and meaningful to them.
FINRA’s Updated Approach to E‑Delivery
In connection with our FINRA Forward rule modernization initiative, we recently sought comment on potential updates to FINRA’s rules in light of the many changes occurring in the broker-dealer industry, including rapid technological advances, evolving business practices and services, and shifting investor preferences. We specifically solicited views on e-delivery. Most commenters supported making e‑delivery the default, while some commenters raised investor protection concerns with this shift. This valuable feedback highlighted the benefits of e-delivery, the need for appropriate safeguards, and the importance of preserving investor choice. And it further paved the way for developing a fresh approach to e‑delivery that strikes the right balance between innovation and investor protection.
As noted above, FINRA’s Board recently approved allowing member firms to make e‑delivery the default method for delivering required communications under FINRA rules, subject to specified conditions to ensure customer protection and choice—such as providing customers with appropriate notice and an opportunity to choose to receive paper delivery, and requiring firms to remediate e‑delivery failures and establish other policies and procedures.
FINRA’s updated guidance would only apply to FINRA rules. If the SEC were to permit e‑delivery as a default under its rules, the approach approved by FINRA’s Board would also permit member firms to follow the SEC’s guidance for purposes of compliance with FINRA’s rules. In addition, FINRA’s approach would not require member firms to change what they are doing today—they could still utilize paper delivery, or they could still follow existing FINRA guidance permitting e‑delivery for customers who consent to such delivery or who have an account with an online-only firm.
To implement this new delivery framework, FINRA plans to file proposed rule changes with the SEC, publish related guidance in a Regulatory Notice, and monitor how the new approach works in practice so that any necessary adjustments can be made. In addition, FINRA intends to continue to collaborate with its members and other stakeholders to modernize its rules governing how firms conduct their business and interact with their customers in a manner that enables innovation and promotes investor protection.