AIFA calls for changes to FSCS proposals

Published on

Association of Independent Financial Advisers

The Association of Independent Financial Advisers (AIFA) has responded to the FSA’s consultation on the Financial Services Consultation Scheme (FSCS) Funding Model Review.

Chris Hannant, policy director at AIFA, said it was essential that the funding for the FSCS is affordable and sustainable.

He added: “These proposals ignore the current economic climate, decreasing numbers of firms in the sector and the negative impact the RDR will have on advisers’ revenues. As things stand, they risk undermining the long term future of the adviser sector.

“We are calling on the FSA not to increase the threshold for investment intermediaries, not to remove cross subsidy from PRA regulated product providers to intermediaries, and to look again at a product levy and pre-funding.”

On the issue of cross subsidy from PRA regulated product providers to intermediaries, AIFA argues that the FSA’s analysis behind their proposal is flawed, and urges them to reconsider.

Hannant said: “Cross subsidy provides stability and valuable additional capacity in the funding model. The distinction between firms regulated by the PRA or the FCA is an artificial one and not a sound basis for determining FSCS funding issues.

“It is imperative that product providers should retain some responsibility toward their products and that they should be called upon to contribute, alongside the other classes, as there is a close affinity between the manufacture and distribution of products.”

COMMENT ON MORTGAGE SOUP

We want to hear from you!
Leave a comment and get the conversation started.
You need to register to post, so please login or sign up below.

Latest articles

Skipton cuts fixed rates and widens home mover range

Skipton Building Society is reducing rates across its fixed mortgage range by an average...

Quantum Mortgages promotes Mihramane and Ajaib

Quantum Mortgages has made two internal promotions across its sales and completions teams as...

Complex incomes hindering aspiring Scottish buyers

More than half of Scottish adults with complex incomes who do not own a...

MAB adds three senior hires across marketing, finance and technology

Mortgage Advice Bureau has strengthened its executive team with three senior appointments spanning marketing,...

Tenant views of landlords more positive than wider perceptions, YBS research finds

Private renters are significantly more positive about landlords than wider public debate might suggest,...

Latest publication

Other news

Skipton cuts fixed rates and widens home mover range

Skipton Building Society is reducing rates across its fixed mortgage range by an average...

Quantum Mortgages promotes Mihramane and Ajaib

Quantum Mortgages has made two internal promotions across its sales and completions teams as...

Complex incomes hindering aspiring Scottish buyers

More than half of Scottish adults with complex incomes who do not own a...