Exiting the industry and fee-free advice some of most talked about topics on cherry in January
05 March 2024
Leaving the industry and the sometimes polemic question of whether to charge a fee for advice were amongst the top trending topics on the cherryplc.co.uk industry forum during January.
Advisers consulted others within the cherry community on the site for their thoughts and advice on both of these issues.
Among the considerations for those looking to exit the industry were whether they could continue to generate income from the leads produced by their existing websites, e.g. by potentially acting as introducers.
In addition, thoughts were shared by cherry members about whether ongoing Financial Conduct Authority (FCA) authorisation would still be needed, or whether teaming up with a lead referral website or selling their website might be a better option.
Another hotly debated topic was whether it's more profitable for brokers to charge a fee or to offer fee-free advice, with some believing firmly that being ‘fee-free’ helps a lot towards successfully generating more business/enquiries, arguing that fees can sometimes deter potential clients.
Others, however, felt strongly that while charging a fee might potentially deter a small percentage of clients, it could ultimately be more financially beneficial, resulting in less work for the same, or even more money.
Donna Hopton, Director at cherry, said; “Perhaps it was the drop in lending volumes during 2023, or simply a desire for change, but exiting the industry was a popular thread on the cherry forum during January. We see this as a great shame and hope that the support received through cherry can go some way towards stemming this trend. On the plus side though, we have seen new blood entering the industry, which is to a degree quite reassuring. The big question is how this is balancing out. The industry and consumers need more high quality independent advice available to them – not less.
“The question of whether it’s better to charge a fee or not remains as open for debate as ever but the bottom line is there is no correct or incorrect approach. What works for some doesn’t work for others. Relevant here may be the fact that we’ve seen a number of lenders recently increase their proc fees for product transfer business, which might be prompting some advisers to reassess their fee structures.
“For advisers, there is no one better placed than their peers to offer advice and help them through some of the day-to-day challenges of working within the financial services industry. Whether it’s advice on a potential career change or establishing which will be the most profitable business model, advisers on the forum typically find that someone is going through, or has gone through, something similar and is willing to offer a helping hand.
“We continue to see an increasing number of advisers turning to cherry – perhaps seeking a feeling of community, especially now that an increasing number of intermediaries still work remotely or in a ‘hybrid’ manner.
“We look forward to continuing to offer them a place they can go for support and advice as they face the highs and lows of working within the rewarding but sometimes demanding world of financial services.”
