“I am not going to be happy and will seek a full explanation as to why it has gone down.
“They’re likely to be looking for any reason to get back to where I was, otherwise I'll go to the Financial Ombudsman Service.
“I will then lose faith if they come back and say I have no grounds to complain based on investment performance.”
No change for advisers
Many advisers welcomed the regulator’s announcement but said it will come as no change to them.
Darren Cooke, chartered financial planner at Red Circle Financial Planning, said: “I understand that they are trying to bridge the so-called 'advice gap' and part of that problem is firms being able to advise on lower investment amounts profitably.”
Cooke explained that this potentially reduces the costs of giving that advice, in limited circumstances, and will help make advice more accessible.
“I note that all the positive comments are from D2C providers who will look to expand their offering and cover this,” he said.
“I don't think it will generally impact advisers and our clients.
“I do hope the FCA keeps a very close eye on any firms looking to offer this service though to ensure the quality of the advice they give, the scope of the advice is correct and they meet the consumer duty requirements for offering fair value to customers.”
Philip Martin, managing director at Unique Financial Planning, agreed.
He said it will “have little effect for most existing advice firms”, whose client bases will typically have far more complicated financial planning needs, fulfilled with a wider range of tax wrappers.
“It may herald an interesting opportunity for product providers to get back into offering mass market advice in a more economical way however and I’d expect them to be giving serious consideration to re-entering with some of the historical barriers around cost and advice risk having been removed,” he said.
‘Welcome news’
Elsewhere, Tom Kean, director at Thameside Financial Planning, said he has lobbied for years that if the FCA does anything, "it should be to simplify anything they touch".
"This feels like good news to me," he said.
“However, as always, the devil is in the detail, and I immediately worry about the complexity for us, knock-on issues for PII and other goal-post-moving effects this might have.”
Kean explained over the years, he has suggested people seek-out alternative routes to investing via certain do-it-yourself investment platforms because the prospect of advisers handling the “smaller” client is overwhelming.
