Nearly 9 in 10 financial advisers offer independent rather than restricted financial advice, according to data published this week in the FCA’s Retail Mediation Activities Return (RMAR) report for 2022.

Only 12% of advice firms provided only restricted advice while the percentage of advice firms that provided both restricted and independent advice in 2022 was 1%, the same as 2021.

Data from the survey suggest that in many cases restricted advisers are charging more than independent advisers.

The typical minimum initial charge levied by independent advisers in 2022 was 1.1% with 0.9% a maximum ongoing charge. In contrast restricted advisers had a mean minimum initial charge of 1.2% and a maximum ongoing charge (mean figure) of 3.1%.

Only on minimum ongoing charges do restricted advisers have a lower minimum standard fee at 0.4% compared to 0.5% charged by independent advisers (see below).  

The RMAR data is based on detailed returns to the FCA from regulated firms.

Source: FCA RMAR data 2022

Overall, the RMAR data suggests a relatively healthy advice sector in 2022 with reported revenue earned from retail investment intermediation in 2022 up by 3% year on year to £5.5 billion. The number of retail investment adviser staff across all firms rose to 37,381 in 2022 compared to 36,674 in 2021.

The reported number of mortgage adviser staff also rose slightly to 36,441 compared to 36,211 in 2021.

Retail investment adviser staff (2022)

Source: FCA RMAR data 2022

The total number of ‘ongoing clients’ served by all financial advice firms rose by 490,466 during the year to 3.922m.

Separately, newer data suggest a fall in the total number of authorised firms.

Analysis by financial services intermediary data provider Autus of key numbers and trends in the regulated UK financial services market in H1 2023 (based on FCA Register and Directory data) found that the overall number of the number of Authorised Firms this year has fallen by 3.4% to 78,099.

Some 66,607 people are authorised to provide investment and/or mortgage advice, with 30,043 investment only and 27,776 mortgage only. Some 8,788 advise on both investments and mortgages.

Autus research also revealed that more than 4,000 people have moved from one firm to another over the period and more than 10,000 people have joined the Register/Directory for the first time.

Autus analysis also uncovered that: 

• On average, more than 2 mortgage advice firms and 2 investment advice firms have set up each working day in 2023 

• St. James’s Place and True Potential have continued to increase their number of advisers while Openwork and Quilter Financial Services have both decreased  

• True Potential is likely to overtake Quilter FS in H2 2023 in terms of number of advisers

Evelyn Partners (and subsidiaries Bestinvest and HW Financial Services) have seen a substantial increase in adviser numbers in the last 6 months, says Autus, while Mortgage Advice Bureau, First Complete and Quilter Mortgage Planning have all seen reductions in the number of Registered Individuals, while Stonebridge and HL Partnership have grown. Age Partnership lost more than a third of its registered individuals in the last 6 months.