DBS and SimplyBiz founder Ken Davy has hit out at Scottish Widows' claim that the FSA is using the professional indemnity insurance crisis to push IFAs into consolidation.
Widows chief executive Archie Kane told Money Marketing last week that he believes the FSA is pushing IFAs towards consolidation by increasing the regulatory burden and through PI insurance.
But Davy says Kane is wrong about the future of small IFAs and rejects any suggestion that the FSA has a hidden agenda to get rid of them.
He says banks and product providers have wrongly forecast the death of the small IFA so many times that there should be no surprise at the latest comments from Widows.
Davy points out that the FSA has reduced the application form for direct regulation to 40 pages from about 240, making it easier for small firms to apply, as well as reducing the application fee for direct regulation to £1,500 from £2,000.
Davy says: “Given the past record of the strategic wisdom of many large institutions and the millions of pounds they have wasted on estate agencies, tied agencies and other failed strategies, we are very confident that small IFAs have an outstanding future ahead of them. Certainly, here at SimplyBiz we are happy to champion the cause of the small IFA.”