Fewer staff, closed departments and adviser charging variations are just some of the problems facing advisers when dealing with providers in the post-RDR environment…
Everyone was supposed to be ready by now. Whether provider, adviser or support service, firms’ post-Retail Distribution Review (RDR) propositions were supposed to be in full working motion, with only minor hiccups interrupting the calm.
Yet, according to several advisers, delays and mismanagement seem to be worse than they were before RDR. The reasons are manifold and include fewer staff, reported difficulties with legacy systems and a myriad of options for paying the adviser charge.
How are advisers managing these issues?
Fewer staff, shut departments and adviser charging variations - how are advisers finding life post-RDR?
Ruth Whitehead, principal, Ruth Whitehead Associates
“I have found that working with providers has changed since Christmas and the implementation of the RDR rules. Processing of applications is taking longer than it used to because people are being made redundant while, in my experience, the way new products are designed is changing, often meaning that the company’s business support or development manager is less knowledgeable than they used to be.
“There continue to be issues with adviser charging. For example, providers are treating the payment of the adviser charge on investment bonds differently. Some allow that payment to come out of the value of the bond, while others don’t, which has tax implications for the client.”
Ian Roberts, director, ARW Wealth Managers
“Our problems rest with the old-style mutual providers, which account for about 40% of our business. It is difficult to justify moving this business simply because of these problems, but I think these companies have their work cut out – their systems simply aren’t nimble enough in this new post-RDR world.
“We have heard that certain companies are ringing clients of ours asking whether they are happy with the services of their adviser. Call me cynical but, in my view, these providers are either looking to sell to my customers directly, or they want to switch the trail [commission] off and keep it for themselves.
I received an unsolicited letter from one provider before Christmas asking whether I wanted to book an appointment with a member of its sales team. Only right at the bottom did it mention that I might have an existing adviser.”
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