Advisers are servicing more active clients this year despite reservations about the impact increased regulation would have on numbers.
According to a NextWealth report published in partnership with the Personal Finance Society this week, 62 per cent of respondents are handling more active clients than last year while 34 per cent are servicing the same number.
The was despite concerns the impact of Mifid II, which came into force at the beginning of last year, could see the length of time required to service each customer drive a drop in the number of active clients.
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 were intended to increase transparency of costs charged to clients and to strengthen investor protection, but the impact on advisers has led to claims the directive has added 20 minutes of administrative time to each client meeting.
The NextWealth report, which surveyed 482 PFS members, found advisers onboarding an increasing number of active clients was a pattern seen across firms of all sizes and with varying levels of assets under advice.
Minesh Patel, chartered financial planner at EA Financial Solutions, said it was clear why advisers have seen an increase in active clients.
He said: "PFS members deliver great satisfaction to clients and naturally much of the growth comes from existing clients referring new clients.
"Perhaps it is not a reflection of the whole marketplace, but the quality of advice year on year is getting better and the increasing complexity of the world we live and work in means more people are driven to seek advice."
The NextWealth survey found an adviser's average portfolio size varied between £100,000 and £500,000, with smaller firms with fewer than six staff most likely to be servicing clients with portfolios in the lower bracket below £250,000.
Larger firms with more than 20 staff were more likely to advise clients with between £250,000 and £500,000 in assets.
The report said: "And our survey confirms what financial planners know. Customers with smaller portfolios can and do have access to financial advice.
"One in five financial planners has an average client portfolio size of less than £100,000."
Keith Richards, chief executive of the PFS, said: "The advice sector in the UK is subject to constant change, whether that be through evolution or regulatory reform.
"As well as regulatory change, the pace of technological advancement is, and continues to be, daunting but the
opportunities for automating processes to streamline practices and deliver enhanced service to clients are
"Working with NextWealth on this initiative presented us with a great opportunity to provide members with a
resource that they can use to practically benchmark how and where their firm fits with the broader market."
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