Number of IFAs going restricted doubles in six months

The number of IFAs planning to go restricted after the Retail Distribution Review has more than doubled since the beginning of the year, research from ORC International suggests.

Research firm ORC International surveyed 198 independent financial advisers in August 2012 and found that 18 per cent of them plan to use a restricted model post-RDR. This is more than double the 8 per cent figure returned in the company’s February 2012 survey.

Although three-quarters of IFAs said they planned to stay independent in the February survey, this proportion dropped to two-thirds in August 2012.

However, only 3 per cent of small independents will opt for a restricted model compared to 30 per cent of advisers at national firms.

There is also a regional divide, with 30 per cent of investment advisers in the north of England looking to go restricted compared to 14 per cent across the Midlands, Wales and south-west England and just 5 per cent across south-east England, East Anglia and London.

Hanya Dezyk, Research Director at ORC International, said: “Now that RDR is just around the corner attention has moved away from the initial hurdle of achieving qualifications to adapting business models and managing customer expectations.

“More intermediaries appear to be considering the options around the restricted advice model, particularly outside London and the south east, as a way forward for their business.”