IFA Market Has Yet to be Convinced Over RDR and Generic Advice Proposals

For immediate release: 18 February 2007

  ·        Less than one in five IFAs say a generic advice system will improve the take-up of savings products

·        IFAs confirm the importance of incremental qualifications

The independent financial adviser (IFA) market has yet to be convinced over the benefits of the changes to the UK advice market as suggested in the Retail Distribution Review and generic advice proposals, according to new research by Unbiased.co.uk, the website promoting the benefits of independent financial advice. 

Unbiased.co.uk surveyed over 250 of its member IFAs and found that less than one in five (16%) of IFAs believe generic advice proposals will lead to an increase in the take-up of savings products by consumers. Whilst the majority (61%) thinks it will have no impact, almost a quarter of IFAs (24%) believe a generic advice model will lead to a decline in the take-up of savings products.

Unbiased.co.uk’s survey also suggests that IFAs welcome the apparent FSA U-turn on linking the word independent in independent financial adviser to remuneration methods rather than to whole of market advice. When questioned about the impact of the FSA’s Retail Distribution Review (RDR), three in four IFAs (75%) state that the original proposal would have a negative impact on consumers’ understanding of the term independent in the context of independent financial advice. Less than one in ten (7%) believe consumers’ understanding would have been improved.

IFAs however were in favour of increasing the level of qualifications amongst their profession; 74% state that it is important to hold incremental qualifications over and above the current benchmark.

David Elms, Chief Executive of Unbiased.co.uk said, “We have seen a multitude of different views and opinions on the future shape of the UK financial advice market over the last six months. We have always maintained that the term independent must be linked to whole of market advice to help consumers understand the concept of truly independent financial advice.

“There have been various proposals for raising the qualifications benchmark to diploma level and this survey appears to show that there would be support from IFAs for such a move. Looking forward, the debate needs to focus on the nitty gritty of creating transparent payment options for consumers that apply on a level playing basis across all distribution types.”

-ends-

For further information please contact:

David Elms

Anna Schirmer/Jonathon Grove

Chief Executive

Lansons Communications

Unbiased.co.uk

020 7294 3682

020 7833 3131

 

For expert comment or case studies from over 200 media-friendly IFAs, journalists should call Unbiased.co.uk’s Media Services hotline on

020 7294 3682 or search online at www.unbiased.co.uk/media

1.      Independent Financial Adviser Promotion

Unbiased.co.uk is the consumer brand of IFA Promotion, the organisation established in 1989 to promote the value and accessibility of independent financial advice to the public. It represents around 9,000 firms of independent financial advisers across the UK, incorporating over 17,000 registered individuals. These individuals hold over 22,000 incremental qualifications which are each individually verified by the awarding body. IFA Promotion welcomes the prominent display of incremental qualifications and further developments into the credentials of independent financial advice. 

IFA Promotion is sponsored by 28 leading financial institutions, and in the past 12 months, over 575,000 consumers and businesses used unbiased.co.uk to find local independent financial advice.

IFA Promotion believes Independent financial advice should be:

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