The RDR will fail consumers unless the FSA commits to a read-across of the outcomes of the review to every financial advice market, Skandia says.
Currently the review only applies to the investments sector, but the FSA has hinted that firms in the mortgage and protection arena would be “free to apply” any RDR outcomes to their own businesses. Skandia says this may cause firms to adopt “widely varied approaches” when applying RDR outcomes and argues this inconsistency could harm the consumer experience of the sales process. In addition, Skandia says the RDR provides an “excellent opportunity” to simplify distribution in the retail market into two categories – advice and no advice – and to introduce Customer Agreed Remuneration (CAR)...
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