Skandia UK chief development officer Peter Mann has warned it is difficult to see how distrib-utor-influenced funds will be able to operate following the retail distribution review.
Mann says Difs are at odds with the RDR drive to separate distributor from manufacturer.
He says: “The fact that they are distributor-influenced clearly has some kind of connotations in a post-RDR environment where the delineation between the distributor and the manufacturer has to be complete and a degree of influence cannot be exercised.
“It is hard to see how they fit with the RDR. I would be interested to see how they can operate in a post-RDR environment when a clear emphasis of adviser-charging is to segment the manufacturer from the distributor.”
But DV Consult consultant Piers Denne says: “After the RDR, there does not have to be a clear distinction between manufacturer and distributor for products. There does have to be a situation where the income paid to the adviser has to be agreed in advance with the client and then either paid for by cheque or on a matched basis. Difs allow this in a more straightforward manner as the adviser is in control of the pricing mechanisms.”