In a paper commissioned by accountants Grant Thornton and marketing agency Red Tag, 62.5% of providers said they were planning to capitalise on the predicted reduction in IFAs in 2013.
Around 45% said they would be developing products that were specific for simplified advice, which the FSA has said could be delivered by a ‘facilitator’ who does not provide advice.
Distribution tactics would feature “direct sales force in a call centre” and “non-advised business via the website”, the report said.
Representatives from 24 providers, including LV=, St. James’ Place, Friends Life, Just Retirement and Scottish Widows, were questioned anonymously for an hour on their preparations for RDR.
However, Gill Cardy, founder of independent adviser trade body the IFA Centre, said buying products direct from providers was “good news for all market participants”.
“There is also evidence that just because some people purchase some financial services products direct does not mean that they do not also seek advice,” she added.
The report also found many providers had been caught out by the speed of developments in legislation.
Red Tag managing director Graeme McKenzie said he was “surprised” at the lack of preparation of some firms.
Some providers had previously expected the FSA to delay implementation of RDR, leaving them struggling to “fast-track” their plans, he said.
While around 40% of providers were planning to be ready by June 2012, two unnamed companies said they would be compliant by mid-December, just weeks before the deadline.
“Any slippage could potentially jeopardise new business,” the report warned.
A quarter of respondents said they were “still evaluating” their due diligence procedures, and 12.5% had “not started” implementation. Others were “uncertain” about some FSA directives.
“There are a number of players who are still trying to get their heads around RDR,” McKenzie said.
Providers had also revised their implementation spending costs, the report said.
At least two of the respondents plan on spending more than £5m on implementing RDR. Red Tag, which counts L&G, Northern Rock and Axa amongst its clients, said providers had indicated IT budget costs could at least double, with the costs possibly being passed on to intermediaries and consumers.
