- Despite this, new ways of working set to stay beyond lockdown and will result in lasting changes to the way IFAs engage with their clients
Over half (51%) of advisers say working remotely with clients has been their biggest personal challenge in adapting to COVID-19, according to FundsNetwork.
FundsNetwork’s ‘IFA DNA’ research captures the impact of COVID-19 on UK financial advisers*. While many firms moved to remote working arrangements almost immediately as the lockdown was announced, this was not without some disruption. As well as having to adjust to new ways of working, three in ten advisers (29%) reveal the lack of face-to-face contact with clients had the most significant impact on their working arrangements at the height of the crisis, while 30% encountered difficulties because of their reliance on paper-based documents.
With most client engagement largely carried out face-to-face before the spread of the pandemic, many firms quickly introduced new ways of fulfilling this during lockdown, increasing their dependence upon digital and remote ways of working, via online and telephone. Despite some of these initial difficulties, advisers now say they envisage many of these changes are set to stay beyond the current lockdown restrictions.
Face-to-face fact-finding will almost halve from 87% to 47% while online fact finding will see a five-fold increase from 7% pre-pandemic to 34% post-pandemic. Telephone engagement will also quadruple for fact-finding post-pandemic, while goal setting will see an increase of almost six times (see table below for further analysis).
Working practices pre-COVID-19
|Measuring attitudes to risk||73%||18%||5%|
|Cash flow planning||70%||8%||3%|
|Annual review presentations||87%||5%||5%|
Significant shift in the expected working practices post relaxation of lockdown rules
|Measuring attitudes to risk||41%||42%||13%|
|Cash flow planning||41%||32%||10%|
|Annual review presentations||44%||36%||15%|
Source: Fidelity FundsNetwork commissioned NextWealth to research 100 advisers, May 2020
Jackie Boylan, Head of FundsNetwork, Fidelity International, commented: “The COVID-19 lockdown measures introduced in the UK in March 2020 required advisers to change their ways of working almost overnight. Advisers and their clients adapted quickly. Conversations and client engagement which might previously have taken place face-to-face were replaced by video and telephone calls – in the middle of some of the most extreme market volatility we’ve seen for years.
“As the weeks turned into months in lockdown, and without a clear timeline for when restrictions will be relaxed for advisory firms, advisers have taken a progressive view on what working life will look like in the future and recognise the opportunities embracing digital ways of client engagement can offer.
Heather Hopkins, NextWealth, added: “The research reveals that advisers who adapted to meet clients through online video meetings are much more likely to see this as a lasting change to their business post-pandemic than those that are meeting with clients by phone. Advisers that have shifted to phone are more likely to plan to return to face-to-face meetings, compared to those that are meeting with clients online.
“Advisers and clients were forced to adapt to virtual meetings, and many have experienced the benefits of using video to communicate. The meetings are more efficient but also better; they allow advisers to meet other members of the client’s family, clients have immediate access to all paperwork and advisers even report being able to see renovations or home purchases they helped clients to finance.”
As many firms consider how and when they return to the office, more than a third (35%) of advisers are concerned about their potential working arrangements beyond the crisis. Two in five (40%) believe they’ll face limitations under the “new normal” working environment – although 16% feel more positive about the opportunities this might present.
Jackie Boylan continued: “It’s fair to say that advice firms have faced many challenges in the past – the Retail Distribution Review (RDR) and MiFID II are probably the most notable in recent times. However, the coronavirus pandemic has thrown up challenges like never before and will require the industry to once again prove its resilience and ability to adapt.
“With advisers’ minds firmly focused on strengthening their practices for the future, it’s important that platforms are listening and responding to their needs. We’ve already taken steps to offer support; the launch of our new online document upload functionality, “Upload and Send”, combined with our move to accept digital signatures means almost 99% of all transactions and instructions enabled through the FundsNetwork can take place without the need for paper or wet signatures. However, there will be further challenges and opportunities ahead, and we’re working closely with clients to understand the solutions they need to prepare for these.”