Nationwide Building Society is testing a fee-based advice service as it gears up to launch its RDR offering.
The UK’s biggest society will deliver its advice through its single-tie agreement on investment business with Legal & General. Nationwide extended its single-tie with L&G last year, which will be in place until 2016.
Advisers will use the investor portfolio service provided by L&G, operated on the Cofunds platform, in which L&G has a 25 per cent stake.
Nationwide has not yet finalised its charges or how advisers will take their charges. A spokesman says: “We have agreed a five-year extension to our existing investments distribution agreement with L&G. This arrangement will enable us to provide our members with access to a range of investments and high quality advice from our team of professional advisers. We will offer RDR-compliant advice from the start of January 2013.
“The charging structure has yet to be finalised. We are still testing our proposed charges with customers and will confirm these once they have been fully agreed.”
Money Marketing revealed in February that Lloyds Banking Group plans to split its advice arm between basic protection advice and a “financial planning service”.
It is yet to announce further details on how it plans to charge customers for the financial planning service.
Royal Bank of Scotland says it will announce details of its RDR advice proposition in due course.
When Barclays withdrew its advice arm last year, commentators took this as a sign that other banks would follow suit and decide against offering branch-based financial advice.
Atkinson Bolton Consulting director Simon Gibson says: “The success of these advice services will come down to whether the likes of Nationwide and others can make it work from an affordability point of view. One imagines Nationwide has spent time and effort thinking about this and has come to the conclusion that it can.”