13th August 2009

Death of provider consultants?

A recent report – click here, suggests that RDR could put an end to broker consultants as it proposes the removal of most if not all CRM support services, planning tools and training programmes will not be allowed!

Maybe its time the support staff at product providers went to see their Conservative MP?

RDR could well mean mass redundancies among those in our support services. Maybe the RDR is in fact quite carcinogenic for financial services distribution as potentially the FSA is presiding over financial services terminal decline with IFA provider distribution as the victim. If financial services are sold not bought, it must be another win for the banks.

In response to this, a source in AXA (a Panacea supporting major provider) said that;

• Firstly, I am not sure what we are “fighting” against; the RDR is on the whole welcomed by ourselves. The current financial model does not work and needs to be fundamentally overhauled. The professional standards are a good move from a consumer point of view.
• Where we do have a problem with RDR is that the moderately well off individual does not seem to be catered for. Either we are looking at an execution only or off the page sales OR full charging…not much in between, we have a concern that significant numbers of individuals will not be well served by the former and will not be able to afford the latter.
• In terms of provider responsibilities, we already have to monitor and report to the FSA on factory gate products….not much change here.
• We do not hold that the role of the broker consultant will be gone. Our interpretation is that whilst the large payments made to networks etc will stop, we will still be able to offer business development and technical development as long as we do not have any bias on who this is offered to.
• We will undoubtedly see the BC numbers reduce as volume reduces in the market due to the reduction in business turnover BUT we will see a more capable type evolve in terms of technical and business consultancy specialisms.

Click here to read more.