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Advisers say RDR has added extra two hours to business processing time

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Advisers say the complexity of placing business in the post-RDR world has added an extra two hours to the length of time it takes to process new business.

Firms say issues such as weighing up the merits of clean versus existing share classes, battling providers to get answers to queries about adviser charging facilitation and whether trail commission will continue, and dealing with new provider terms and conditions are making life harder for advisers.

Almary Green managing director Carl Lamb says: “We believe the level of research, checking and double checking we have to carry out to process new business is probably adding an extra two hours to the whole process.

“When dealing with providers, you can ask the same question to three people and get three different answers. Everything takes so much longer because you are having to double check everything because we do not believe what we are being told by the providers the first time around. We should not have to do that.”

Thameside Wealth director Tom Kean agrees. He says: “It is a bit of a nightmare at the moment. What seems to be catching people out is the sheer insanity of some of the issues at stake, such as providers only paying commission if no advice is given. Providers are interpreting the rules in isolation and never in exactly the same way, so we all end up having different processes for each provider. It is painful.”

Attain Wealth Management managing director Gordon Crothers says: “The whole process is getting more drawn out, more time consuming and more costly for advisers to deal with.”

Apfa policy director Chris Hannant says: “It is to be expected that there will be a bit of friction as part of the RDR transition. Those providers who have got their act together, with a reliable service and a consistent message from their frontline staff, will earn more respect and will do better as a result.”

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Comments

There are 10 comments at the moment, we would love to hear your opinion too.

  1. I can’t see how RDR has added an extra 2 hours onto your business processing time. RDR is here, get over it and move on. IFA’s should have implemented RDR processes way before the end of last year, it’s their fault if they are now struggling.

  2. Sorry its two DAYS!

  3. Anonymous 9.07

    It’s not the advisers who are ill prepared in the maion, it’s the providers!!

  4. Just add to the hourly fee, that is what RDR set out to do, clear and transparent based on hours worked and not case size.
    Or have I got that wrong

  5. “Apfa policy director Chris Hannant says: “It is to be expected that there will be a bit of friction as part of the RDR transition. Those providers who have got their act together, with a reliable service and a consistent message from their frontline staff, will earn more respect and will do better as a result.”……. So adviser place business with those who can pay them faster and properly?…. Hmmmmm…. So we will place business with those who can pay us properly, on time and with the least hassle?????, even if it they a crap product. Do you know what guys, Our illustrious Association has just admitted publically that bias is now a reality and according the the FCA this is one of the main things RDR was supposed to get rid of. There were always going to be problems with this situation and as for Anon’s ridiculous statement about IFA’s processes being in place long ago – its not the IFA’s at fault here. The blame lies solely and firmly atthe feet of those providers who have not got their act together. We can only do so much to make the recommendations. Get real Anon.

  6. Anonymous at 9:07: I think you are missing the point partially. I disagree with the double checking thing in the article too because that implies that advisers were not checking things carefully pre-RDR and should have been, I think the main grumble is that providers’ lack of readiness for RDR, their staff’s lack of knowledge and because they weren’t ready and prepared their lack of systems in place to facilitate advisr charging, added to that the fact that those who do have procedures differ hugely from provider to provider. This article isn’t a whinge about RDR it is a whinge at providers and their incompetence and lack of flexibility causing delays (this could not have been built in before RDR as in most cases providers didn’t know what they would be doing pre RDR which is scary!) and the lack of clarity beween information available on certail clean and unclean fund charges and how to compare them when not all of the charges are included in one class (refund of dividends, the tax position of such dividends, etc)

  7. Anonymous at 9:07 am is an idiot. He clearly has no experience of what is involved when advising clients and therefore is not in a position to comment. In fact I find his / her comments offensive since they are so naive.There is no way anyone could have been ready because IFAs rely on providers and it is the providers with their differing approach and requirements from the start of the year that has hindered things.
    We could have done no more to be ready and the fact that we are struggling is not the fault of the IFA. We knew there would be problems and there are.

  8. I think 2 hours is being generous. On average with providers all have differing processes and the reports to clients 2/3 ‘why not a particular course of action’ I average 3 hours easily at the moment.

    I do expect the providers to streamline and speed up but the reports and research documentation is mind numbing (and frankly unnecessary). The one thing it is not is client friendly or easy to read.

    Anyone who thinks differently is exposed are in for a rude awakening when the FCA calls.

  9. TWO days?? You must be joking! it should not add two days. IFA’s need to really look into how they are transacting business if it is adding that much time on.

  10. Sam Caunt, I think that an IFA who was not ready for RDR is the one that is lacking in experience and professionalism. I work for a thriving IFA business who has been transacting advice through adviser fees before RDR was originally announced. There was no offence intended, just speaking my mind from the eyes of an employee of a successful Chartered IFA practice who have never been busier post RDR, knowing that we were fully ready for the changes that IFA’s have been putting off for years.

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