Becoming a DA – Kiefert

The big question for most is whether the decision made continues to be the right one. 

Making this decision can be difficult and will often require a great deal of time and thought, particularly as there is no right or wrong answer. Both options offer pros and cons, and the final decision is often based on the best and most suitable option for the firm, its employees – particularly the advisers – and their individual business needs.

The advantage of the AR route 

One of the many benefits of being part of a network, for example, are the set parameters that exist, the support, the compliance cover, and the abundance of business opportunities for all ARs.

This can offer peace of mind to many owners and can mean AR is the preferred chosen path for some, as the ongoing compliance and business support ensures they can continue to meet regulatory demands as they focus on growing their business.

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However, it may also mean that by design, networks have a restrictive aspect to them, as being in charge of lots of AR firms means they can’t necessarily provide a bespoke service to each and every one of their members. 

This can be a challenge for those advisers that want more control over a greater number of aspects of their business. For these advisers, therefore, the DA option is likely to be the more popular route.

Graduating to DA 

Becoming a DA is often a natural step for growing, large-scale, or more established adviser firms seeking a greater level of autonomy over the products and services they offer their customers.

In fact, a poll carried out by Mortgage Solutions last year showed that the number of advisers considering moving from AR to DA status dwarfs those looking to go the other way, with a quarter looking to move to DA status, compared to just 7% looking to become an AR. 

These figures are interesting and suggest the natural journey for a lot of firms is to eventually take the DA route once their business becomes more established. While this can initially prove liberating, it also requires a significant amount of time and understanding of regulatory matters, which can be a concern for any adviser firm making the move.

Weighing up the decision 

Therefore, it is essential for any firm owner considering making the transition from AR to DA to review all their options before making a final decision.

Working with a DA club like The Right DA Club – which is not only a compliance service provider but a mortgage club too – can help advisers strike more of a balance, by offering the freedom of being DA with all the support of a network.

In fact, it can even help to smooth the transition from being an AR to becoming a DA, as some offer FCA application support services at the start of the transition process. 

Firms also offer other services such as file reviews, compliance support days, training events, and other business development options. 

Being a member of a distribution business will also open up access to exclusive products and services available through certain technology platforms. This will enable DA firms to pursue other avenues that may have been off-limits to them previously. 

Before deciding to transition to DA status, it is important that any firm owner considering making the move carry out their due diligence before taking the leap. Timescales, fees, and potential drawbacks involved need to be evaluated, so firms can make informed decisions and plan accordingly.

Making the move from AR to DA status can be a tough and lengthy process, which is why leveraging the support of a business like ours that offers guidance and support can provide adviser firms with the information and support they need to make a decision.

It will also help to ensure they have all the information they need to grow their business and reach their full potential.