Research reveals only 5% of IFAs are RDR-ready
New research suggests IFAs are still too slow to change their business models in preparation for the Retail Distribution Review.
Only one in twenty IFA firms are ready for the Retail Distribution Review, according to a survey by IFA database MyTouchstone.
Just 5.1 per cent of the 4,600 IFA firms surveyed by the company said they are fully prepared for the RDR.
Neil Cunningham, director and general manager of MyTouchstone, also said the qualifications picture is mixed.
It is a requirement that at least one adviser must be qualified to QCF level 4 for a firm to be deemed RDR-ready. But according to the latest MyTouchstone research, 57.7 per cent of firms have no advisers qualified to QCF level four – “a small but worrying increase” from Q3 2011 when the percentage was 57.5 per cent.
However, most positive, is the fact that 30.4 per cent of the 6,431 IFA firms that completed MyTouchstone’s latest qualifications survey, have all their advisers qualified to at least QCF level four. This is an increase from 27.2 per cent in Q3 2011. And 41.1 per cent of the 7,871 individual advisers who participated in the survey said they are now QCF level four qualified – an increase from 39.5 per cent in Q3 2011.
However, this data is in stark contrast to date recently unveiled by the Association of Independent Financial Advisers who found that 75 per cent of advisers are RDR-ready or will be by the end of this year. The survey of more than 300 advisers also found that 7 per cent of advisers had not yet reviewed their business models ahead of the RDR and 6 per cent did not know how prepared their firm was for the implementation of RDR at the end of this year
Mr Cunningham said: “There isn’t much time left until IFA firms need to be completely RDR- ready, yet the signs from this data suggest there’s still considerable work to do.
“We expected to see a real acceleration in firms changing their business models in preparation for RDR but the data we’re seeing suggests otherwise.
“More than 1000 IFAs log on to the MyTouchstone database every month to upload fresh data, providing a valuable insight into IFA business make-up and qualifications and making it highly reflective of current market activity.”