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Tenet brings in factoring service

Tenet is to offer a factoring service for protection business, which will be extended to cover investment and pensions when provider-led factoring is banned at the end of 2012.

It will fund up-front payments to advisers on protection business while itself receiving income from providers on a trail basis.

Tenet first developed the initiative in 2006 but shelved plans after the original retail distribution review paper to ensure any scheme it introduced would be compatible with the new regime. Group distribution and development director Keith Richards says the FSA was open to the proposals during initial discussions.

Richards says: “The remuneration shift within the RDR should not be underestimated. An alternative factoring service will go a long way to supporting advisers who do not want to turn their backs on existing clients unable or unwilling to pay fees.”

Sesame last month set out plans to offer advisers a form of factoring if the FSA refuses to allow up-front payments from providers, particularly on regular-premium business.

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