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Industry breathes sigh of relief over adviser growth

The industry voiced relief last week after the FCA published data showing the number of qualified financial advisers operating in the UK had risen following the introduction of the RDR.

Some even predict further increases in overall adviser numbers as banks and building societies return to the advisory sector, having made hundreds of advisers redundant in 2012.

The FCA data showed 32,690 advisers were operating in the UK at the end of June, an increase of 5 per cent since the regulator’s previous census in December 2012.

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The rise was attributed to some advisers gaining the necessary level 4 qualifications after the RDR was implemented, having dropped off the FCA’s figures in December.

“It is positive news, which makes a change as there were a lot of people saying the number of advisers was going to be decimated by the RDR,” said Dan Clayden, director at Devon-based Clayden Associates.

Mr Clayden, who runs revision courses for advisers for the Chartered Insurance Institute, added that there was “still demand” for the courses.

“It is nowhere near the peak in 2011 and early 2012, but still a far higher demand then I would have assumed if it had just been new entrants and natural turnover,” he said. “I think we will probably see the number of advisers rise a little bit more in the near term.”

Gill Cardy, founder of IFA Centre, said a number of her members were actively seeking to recruit and expand their companies, as well as looking at ways to offer advice to the mass market. This had been helped by the increased profile of financial services and advisers in the consumer press covering the RDR.

“There has not been the meltdown that many advisers thought there would be,” she said.

Ms Cardy added that future industry numbers were likely to be “more consistent” as new entrants came into the market to replace those who left prior to the RDR.

Leicester-based adviser Ian Highton of Essential Financial Advisers said 2013 had been his company’s “best year ever” for new business.

“There was a lot of publicity saying that adviser numbers were going to go down, with more business for less advisers, but there may just have been a number of people who weren’t where they needed to be with their exams,” he said.

Pete Matthew, managing director at Cornwall-based Jacksons Wealth, said: “People I’ve spoken to have had a quiet start to the year. There was almost a collective exhalation: ‘We haven’t gone out of business.’ It was a big change but it’s picking up nicely now.”