RDR is just the "start of a long haul": Folkard

Steve Folkard, head of pensions and savings policy at AXA, believes that the Financial Services Authority's (FSA's) RDR gives the industry a chance to win back consumer trust that has been damaged over the years by various scandals.

"The only thing that will make the RDR a success is if consumers buy into it," he said.

However, he warned that there was a danger that the proposals to have 'sales' and 'advised' categories may confuse consumers and actually take the industry a few steps back.

"Some firms will reorganise themselves to offer sales and advice but with sales, there is a danger it will open the doors to mis-selling with the potential for more scandals," Folkard said.

The RDR aims to increase professionalism in the industry and have the effect of increasing the reputation of financial advisers by raising the level of qualifications required.

But Folkard said that striving to gain these new qualifications and get better trained presents another problem, because of the associated costs of doing so.

"Product providers many need to step in and offer training to up skill advisers," said Folkard who believes the FSA should consider how this could be facilitated.

Although it is still largely unclear what impact the RDR will have on the industry, Folkard believes that "it is the start of a long haul". He says it will take as much as 10 years to re-establish the financial services industry’s reputation.