Generic financial advice (GFA) aims to open up the financial services sector and help consumers make the most of their options, with the provision of information driven by what advice is best for the client, rather than a sales process.
The cost of GFA is estimated to be around £40-£80million, to be met jointly by the government and the financial services industry, but aims to allow everyone the opportunity to get no obligation, clear advice on their finances.
Otto Thoresen, the author of the report, said: “The research and evidence we have gathered so far has enabled us to define, in broad terms, some of the principles for a national system of GFA. Complete impartiality and effective marketing will be critical. But it’s also essential to design a system which will be of genuine benefit to people and which can be sustained over the longer term. We are currently running pilot schemes to test out elements of a national system and the findings will enable us to develop the proposals in the months ahead.”
The plans have been broadly welcomed by the industry. Richard Farr, director of the Association of Mortgage Intermediaries, commented: “There are some good things in there and we will be very pleased if it helps engage the public. Hopefully, it will help people become more financially savvy and won’t see them bury their heads in the sand if something goes wrong. However we are not keen, and neither is Thoresen, on the term GFA.”
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