London dominates advice market, new data shows

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Nearly half of all advice firms are based in London, data released by the FCA suggests.

Of the 2903 new advice firms the FCA has authorised since 2010, 1275, or 43%, are based in the capital. The South West has the next highest number of firms, with 265.

The South East, with 184, has more advice firms than the whole of Scotland, which has 183 firms based in the country.

Glasgow-based Independent Advisers (Scotland) managing director Alistair Creevy says that apart from the concentration of wealth in the capital cultural factors might also impact the distribution of advice firms.

Creevy says: “The more commercial people in London will engage advisers because they know they have to pay for a good service, but up here people are more reluctant to do so.”

“There are still enough business people to run a successful practice though. A millionaire in Glasgow is very well off but in London you might need that just to live.”

The North West has the third most advice firms with 198 based there.

The region with the lowest number of advice firms is Northern Ireland, which has just 36, followed by the North East, with 73 firms, and Wales with 80.

The information comes from a Freedom of Information Act request published on the regulator’s website today and is correct as at July 2016.

The FCA was not able to provide a breakdown of assets under advice by region however because advice firms do not have to provide this as part of their regulatory returns.

The FOIA response says: “Within our Retail Mediation Activities Return regulatory return, which we require advisory firms to complete, we instead capture revenue from advisory activity and number of advisers which can be used as a proxy for firm size.”