Advisers wary over new regulations

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Independent financial advisers are nervous ahead of changes triggered by the Retail Distribution Review, which comes into effect at the end of the year.

The latest ORC International syndicated Investrack survey revealed that, as the December 31 deadline approaches, 20 per cent of IFAs feel they will have fewer customers as a result of RDR. The change will require all advisers in the retail investment market to follow new rules on pricing transparency, structure and professional standards, requiring a review of their current business model.

The survey found that only 11 per cent believe they are likely to have a greater number of clients, while seven per cent feel that RDR will provide them with more business opportunities. Meanwhile, discretionary asset managers are more optimistic, with 25 per cent positive they will see increased business and 33 per cent believe they will have more clients.

Hanya Dezyk, research director at ORC International, said: “Many IFAs don’t have an actual business model in place to deal with this kind of regulation and will need to make some fairly drastic changes to meet RDR requirements.”

She added: “Many DAMs already have a business model in place that can be easily adapted to the changes, so for them, RDR is essentially business as usual.”