Public have double the faith in IFAs than banks

FSA research reveals IFAs’ clients are almost twice as likely to feel very confident about the advice they have received than those who see a bank adviser.

It conducted face-to-face interviews with 2,064 adults for its latest consumer awareness survey, published last week. It finds 17 per cent had received professional financial advice about a financial product in 2011. Of those that sought advice, 47 per cent saw an IFA, 41 per cent saw a bank or building society adviser and 12 per cent used other sources of advice such as accountants or solicitors.

When asked how confident they are the advice is appropriate to their circumstances, 61 per cent of those who saw an IFA say they are very confident the advice was suitable but that dropped to 33 per cent for banks and building societies.

The FSA says: “The reason for the difference could be due to the nature of the relationship, with greater continuity of knowledge and person alisation by an IFA than a bank or building society and the demise of the ’personal’ bank manager.”

The FSA notes the total proportion that were either very confident or fairly confident about the advice given was around 90 per cent for both channels.

Axxis Financial Planning director Owen Wintersgill says: “Since the credit crunch, the reputation of the banks is even worse than it was before. “I am surprised there is not a more significant difference in the confidence scores between IFAs and banks, especially since so many banks have closed branches or withdrawn their salesforces.”