The UK should regulate financial services products rather than advice, says Scottish Widows protection marketing manager Nick Kirwan.He says advisers have a tough time remaining compliant on largely personalised products and they get little support from the FSA, which often makes retrospective decisions. Kirwan says product regulation is successful in other European countries and in other sectors such as food and sees no reason why it could not work for UK financial services. Product regulation might mean a supplementary type of regulation, for example, advisers adding safeguards on specialist products such as high-risk investment products. Kirwan says there would also be additional enforcement through corporate governance, with providers ensuring that the products are compliant and are benefiting consumers. He says placing less onus on advisers and giving more provider support on the products they market would entice more people into the advice industry, ultimately giving consumers greater access to advice. Kirwan says: “The number of advisers is dwindling fast. This is partly because the barriers to entry are quite high and with more advisers and therefore greater access, this system would bring great advantages. This would give advisers a significantly lighter touch but they would need to be responsible for implementing other safeguards on specialist products.” He says he recognises that there is a counter-argument over product innovation. Kirwan says: “I am not saying this would be Utopia. It might be seen as a barrier to innovation but currently it is hugely difficult for IFAs when they are up against decisions made with 20/20 hindsight.” FSA spokesman Robin Gordon-Walker says: “We are not that sort of regulator and any movement in this direction would take a huge legislative overhaul. In Germany, this system has restricted the market and we would be wary of that happening here.”
Harry Baldwin has joined Winterthur Life as IT development manager to expand its Professional Edge range of adviser support services.
An ABI survey into consumers’ views on personal accounts found 60 per cent fear for the safety of their savings under a centrally administered NPSS as opposed to 47 per cent for an industry model. It also found that 80 per cent of the 2,247 surveyed want some choice over who administers their personal account.
Aifa hits back after mystery-shopping shows widespread failings
The Government’s reforms could spread provision very thin throughout the UK
Indian equities have officially re-entered a bull market, with the benchmark index climbing to a 11-month high. Better-than-expected data on US jobs and a brightened outlook for global growth have contributed to the market’s strong returns, but domestic drivers have also played a big part in the recent rally. Kunal Desai, Manager of the Neptune […]
News and expert analysis straight to your inboxSign up
Latest from Money Marketing
The Government has confirmed that the pensions lifetime allowance will rise in line with inflation, but savers have been offered little else in the Autumn Budget today. The lifetime allowance will increase from £1m to £1,030,000 to match CPI from 2018/19. Though the maximum amount the can be saved each year into a Junior Isa […]
The Government has outlined a raft of measured designed to bring in an additional £160bn from tax cheats. The seven-year plan lists 18 different ways the Government is looking to raise the revenue. These include extending how long HM Revenue and Customs can go back in time to assess non-compliance for offshore tax evaders. Double […]
Chancellor Philip Hammond has announced the Government will today publish a ‘patient capital’ action plan that aims to unlock £20bn of new investment in UK scale-up businesses. A patient review was announced a year ago and was touted as part of the Government’s industrial strategy to increase productivity and drive growth through breaking down the obstacles […]