Advisers are split over whether the retail distribution review will improve the standard of financial advice given to clients.
Research from Skandia suggests 43 per cent of advisers believe the RDR will improve the standard of financial advice given to consumers while 29 per cent believe the RDR will have no effect and 29 per cent say it will have a negative effect.
Of the 43 per cent who believe the RDR will improve advice standards, 73 per cent believe this will primarily be because of higher qualification standards, 19 per cent believe it will mainly be because of the ban on commission and 4 per cent because of the introduction of restricted advice to complement independent advice.
The majority, 84 per cent, of advisers say they are planning to remain independent post-RDR but 11 per cent say they intend to offer a restricted advice service. Of the 11 per cent, 8 per cent intend to provide restricted advice on top of their independent advice service while 3 per cent say they will switch from independent to restricted status.
Only 6 per cent of advisers say they will leave the industry when the RDR comes into eff- ect on January 1, 2013. Two per cent say they already had plans to leave and 4 per cent say that the RDR will force them out of the industry.
Churchouse Financial Planning managing director Keith Churchouse says: “The reality is when they are faced with some of the home truths that are going to come home to roost in 18 months, I think that much more than 6 per cent of advisers will leave the industry.”