In a kind response to comments to the new Dunstan Thomas business guide – “WRAP platforms – transforming the way advisers do business” from Kevin Jack of Enhance Solutions…..
Thanks for your email below and the WRAP publication which is very thorough and ticks all the boxes as far as I can tell regarding the development of the Wrap market.
Assuming RDR is delivered on time, I can see potential chaos as IFAs who wish to remain independent struggle to divorce themselves from commission payments – it’s bad enough effecting a change of agency let alone rewriting the whole commission model. Therefore, your point about IFAs unbundling commission arrangements sooner rather than later has resonance and will place them at an advantage over their competitors.
Although it was given a thumbs down in the survey results, one of the results of RDR is the potential for Wrap providers to take the place of Bancassurers or life companies as ‘direct to consumer’ distributors of product. I can see people flocking from banks for advice and also many consumers wishing to take control of their own affairs (‘what do I need to pay an adviser for?’) – maybe a Wrap provider may become the new ‘man from the Pru’ (possibly the ‘man from Novia’?). Wraps lend themselves to online distribution, so direct to consumer via the web must be a route under consideration.
My final observation, also highlighted in your report, relates to Wrap flexibility to accommodate esoteric investments; this appears especially pertinent now as many advisers look to alternative investments for positive returns, such as structured products, life settlement funds and film partnerships to name a few. Any Wrap that can accommodate these within their tax wrappers will be at an advantage.