BBA opposes FSA attack on tied advice

by Gill Montia

Story link: BBA opposes FSA attack on tied advice

The British Bankers’ Association (BBA) has criticised new measures being proposed by the Financial Services Authority (FSA) that could curtail or even outlaw tied advice, such as advice given by a bank based on the range of products its provides.

The BBA believes that consumers could lose out under the proposals because they would be caught between choosing to paying a fee or buying a financial product without the benefit of advice.

According to the BBA, people with less than adequate savings or investments would be worse affected and this in itself would contradict the various FSA and Government initiatives aimed at encouraging saving.

The association says it will follow up the concerns it is raising with the FSA, and will use that opportunity to discuss whether improved disclosure could provide acceptable sales and advice practices.

Angela Knight, the BBA’s chief executive, points out that customers seeking advice often have a good idea of what they need and want to buy financial products from a brand they know and trust.

Under the current arrangement this group of consumers can benefit from the tied advice system.