The Markets in Financial Instruments Directive is estimated to have added 20 minutes of administrative time to each client meeting, according to the Chartered Institute for Securities & Investment.
Mifid II requires financial services firms to disclose a breakdown of all costs and charges associated with a client’s investments, on both a forecast and actual basis.
The rules took effect in January 2018 with the intention to increase transparency of costs charged to clients and to strengthen investor protection.
But this came at the expense of additional time costs for advice which the industry has warned will ultimately be billed to consumers.
Jacqueline Lockie, head of financial planning at the CISI, said she has spoken with financial planners for whom the additional work associated with Mifid II was adding at least 20 minutes of administrative time to each client, for each meeting.
Ms Lockie said this cost was ultimately directly billed to the client, as a direct cost from Mifid II.
This comes in contrast to the Financial Conduct Authority predicting Mifid II will save UK investors £1bn over the next five years, after it hailed the rules as a "major piece of post-crisis regulatory reform".
In a speech at the European Association of Independent Research Providers in February Andrew Bailey, chief executive of the FCA, said Mifid II had already had a positive impact on the cost of research in the market.
Mr Bailey said the regulator estimated the reduction in charges for investors in UK-managed equity portfolios was around £180m in 2018.
"Assuming similar savings going forward, this equates to nearly £1bn over the next 5 years," he added.
Ms Lockie said: "From a professional perspective we wouldn’t want to see any large changes in legislation that could ramp up those costs further.
"We are trying to use computerisation and efficiency software to drive down the costs of giving advice so that good financial planning can be given to a wider proportion of the population."
But Ms Lockie said continuously increasing regulation effectively drives up the cost of giving advice, instead suggesting a time of regulatory "stability" would be more beneficial.
Earlier this year Bim Afolami, the MP for Hitchin and Harpenden, raised concerns Mifid II was preventing smaller firms from competing in the market and suggested the extra regulation meant these firms were unable to establish themselves in the industry due to cost.
rachel.addison@ft.com
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