More IFA firms will start to offer execution-only services to some parts of their client bank, says Fidelity International head of UK fund partners Ed Dymott.
He told the round table that the company is already seeing a number of firms offering execution-only services to clients who have become unprofitable to advise. He said: “This gives advisers the ability to deal with those clients who today do not have a lot of value but in 10 or 15 years time could bring an enormous amount of value.”
But Institute of Financial Planning chief executive Nick Cann said there are some dangers in this approach. He said: “I worry that advisers think putting the technology in place to run a direct-to-consumer system is an easy thing to do, and it is not. There is a danger of advisers failing to operate their core business properly and yet extending the platform they use to cover the direct market.”
Taxbriefs editorial director Danby Bloch predicted more clients would opt to manage their finances themselves, particularly where their needs are straightforward. He said: “There are a lot of people with relatively simple situations and I suspect those are the sort of people who would prefer to do things themselves. It is just not high-net-worth clients that go to IFAs but also those with relatively small investments with simple needs and I think they are the people who are going to drop out of the advice market.”