Nine out of ten IFAs say they will remain independent

Issued: 23/01/2012 00:00:00

Tenet comments on Defaqto's latest research

Almost nine out of 10 advisers intend to remain independent following the Retail Distribution Review, according to the findings of a new study published by financial research company Defaqto.

In a survey of 350 advisers who use platforms, 87 per cent said they intend to remain independent, even though the requirements for the independent title will become more stringent after RDR implementation.
This comes despite industry speculation that tougher requirements would force more advisers to take the restricted title.

Keith Richards, distribution and development director at Tenet Group, said: “That percentage is probably consistent with the percentage who would prefer to stay independent. There has been a growing level of consensus that maintaining the title of independent post-RDR might be too demanding.

From our research, advisers definitely prefer to remain independent but there is a maturing attitude in the market where advisers realise restricted doesn’t necessarily mean multi-tied.”

Mr Richards added that research conducted by Tenet suggests maintaining the independent title might not be as difficult as many advisers assume.

However, he said that about four out of five advisers will have to increase the range of products within their consideration in order to keep their status as independent.

Chartered financial planner Gary Bottriell said: “It doesn’t surprise me that much because most current financial advisers would like to hang on to the moniker. I can’t imagine anybody who will prefer to be restricted.”

Fraser Donaldson, insight analyst for funds at Defaqto, said: “The challenges facing the advisory community as they prepare for RDR implementation are numerous - and certainly the next 12 months could be challenging for advisers as they seek to transition their businesses in time for 2012.

Other challenges outlined by Defaqto include transitioning to a fee-based charging system, the decision to outsource investment administration and decision making, and communicating the post-RDR service proposition to clients.