View more on these topics

Put to the test

Almost without exception, every part of the financial services landscape that we thought was stable has been turned upside down and shaken about over the past year or so. This uncertainty obviously encompasses the stockmarkets although even distribution is suffering upheaval.

If we think back only a few years, distribution was fairly straightforward and could be split into two distinct categories – product providers sold direct to the public via their direct salesforces or via IFAs and investment houses sold via IFAs and direct, usually utilising off-the-page ads.

Things slowly changed, with IFAs having their own broker bonds and Skandia starting to sell other companies’ products although this evolutionary development started to accelerate with the development of white labelling and strange, often Antipodean or American imports such as fund supermarkets and multi-managers. With time, increased computing power and particularly the growth of the internet, all these new advan-ces became accepted but they did not really disturb the usual distribution models too much.

Recently, however, all this has changed with the advent of RDR and the coming together of a number of separate, unrelated strands into the marketplace.

For those living in the proverbial cave, the RDR is merely the latest change since the Financial Services Act in 1986 – commission disclosure in 1993, depolarisation in 2005, a move by the FSA from rules to principles, the introduction of treating customers fairly and finally the retail distribution review.

This was launched by the FSA in the balmy economic conditions of 2006 as a response to what they perceived to be recurring problems in the retail financial services market such as product and provider bias, churning of products, lack of access to financial advice and a perc-eived lack of professionalism.

The latter has meant that grandfathering is no longer allowed although current industry qualifications will definitely be taken into account under the FSA’s no regrets policy so it is still worth your time taking diploma-level qualifications.

In the considerably choppier economic conditions of 2009, all the above now means that whatever money the investing public has, there are potentially a similar range of eventual destinations – pensions and investments that have not altered too much although there is a bewildering array of routes to get there.

The complexities of investment/asset allocation mean that all advisers need to be able to use the tools that the packagers have on offer so as to be able to offer the levels of holistic aftercare and service that customers now demand. Ironically, because there is more information available, the ability to sift through that glut of data becomes ever more important and this means that advisers need to become much better qualified – another RDR requirement.

For both potential and current advisers, there has never been a more important time to get qualified. We are in an employer’s market and they are being driven to only recruit the best so as to be able to both obtain and retain business.

Harris Keillar is managing director of Keillar Resourcing

Recommended

M&G launches offshore mirror Woolnough fund

M&G has launched an offshore version of Richard Woolnough’s Strategic Corporate Bond fund. The Guernsey fund was launched on Friday (July 10) as a direct feeder fund exclusively linked to Woolnough’s Strategic Corporate Bond fund.M&G says it was launched in response to demand from its offshore client base, and complements the existing offshore fund range […]

Raise the red flag issues

In 1865, Britain introduced the Locomotives on Highways Act, better known as the Red Flag Act. Among other things, the act stipulated that all mechanically powered road vehicles must be preceded by a man on foot waving a red flag to warn the public.

Big firms face tough checks

Chancellor Alistair Darling plans to impose enhanced prudential regulation and stronger capital requirements on large and complex financial organisations.

Time to stop the salami slicing on tax relief

Steve Webb  – Director of Policy and External Communications As the Autumn Statement approaches, Steve Webb calls for the Government to stop tinkering with tax relief. Twice a year, in the run-up to the Spring Budget and the Autumn Statement, we face a torrent of speculation as to what changes the Chancellor might make to […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment