335,286 client accounts closed by advisers

The number of client accounts ‘ceased’ by advisers has almost doubled in four years, according to FCA data.

Last year saw 335,286 client accounts closed by advisers, almost double the 182,178 recorded in 2020, the data showed.

‘The retail intermediary market data 2024’ report also showed that revenue from retail investment intermediation increased by 6.2% to £5.7bn in 2024, compared to 2023.

It also revealed that the reported number of retail investment adviser posts across all firms fell to 37,441 in 2024 compared to 37,618 in 2023.

Jeremy Mugridge, AJ Bell advised marketing director, said: “The FCA’s latest data highlights the growing number of clients that advisers no longer feel they can service, and in many cases this is likely because it is not cost efficient to do so given the lower wealth profile of the accounts – but it doesn’t have to be this way.

“Rather than losing valuable clients of the future, advisers need to be able to service those who have smaller accounts now to ensure they do not leave the advice market entirely.”

He said that advisers want to service as many clients as is feasible, and need solutions from providers allowing them to do that as easily as possible.

Mr Mugridge said technology has to play a pivotal role in the evolution of the advice process so that potential clients of the future aren’t left by the wayside, along with the wealth they could accumulate over time.

Research from the latest Lang Cat Advice Gap report showed that one third (31%) of advisers surveyed said better digital channels would enable them to attract or retain more clients who want either limited in-person interactions or who wouldn’t otherwise be profitable to firms, as well as a further 26% who say they could service more clients.

Earlier this year AJ Bell launched its streamlined platform Touch which the firm claimed would help financial advisers implement investment advice for clients more quickly and securely.