Insight
Title:
The size of the advice market is constrained
Description:
The FCA has just launched The Financial Advice Market Review ("FAMR", already dubbed RDRII). It aims to:
- Examine the advice gap.
- Look at ways to ensure the regulatory and legislative environment allows and encourages firms to innovate and grow their business models to include affordable and accessible financial advice.
- Considers ways to encourage people to seek financial advice, addressing unnecessary barriers that currently deter them
This is just the most recent of a steady flow of challenges to the advice market (most of which were predicted to portend the death of the advice market!):
- Commission disclosure (90's)
- Depolarisation (2005)
- The end of commission (RDR - early 10's)
- Regulatory fees (Regulatory fees - mid-10's)
- Consolidation (periodic but ongoing)
Historically, many advisers were trained in life offices before becoming independent advisers, but that avenue is no longer open. Few advisory firms have the capacity to train new advisors, and those that do, do so in relatively See Philsmall numbers.
PESTEL:
Political
Five Forces:
Bargaining power of buyers