Many advisers are considering their place in the fully licensed regime.

Steve Burgess, director of the Compliance Refinery, says single adviser businesses have been starting to consider the benefits of being part of a larger aggregate FAP.

“Some of the larger groups have been telling me that they have been seeing single adviser FAPs starting to come to them looking for a home.

“They have seen some businesses come through and kick their tyres, casing out the benefits of joining them under their FAP.”

Burgess says that while these reports are largely anecdotal, it could be a sign of things to come.

“While we haven’t seen a lot of movement yet, we are starting to see businesses really consider whether or not it is a good time to move.

“A lot of these businesses are going to have to make a decision soon.

“There are a lot of people who went into the new regime who got a transitional licence and did not think too far ahead.

“While they are technically currently acting as a FAP, many are still undecided whether they would go into the new world.”

For a single adviser considering bringing their book to a larger group, Burgess says they need to carefully consider the offerings of the groups, “I think there is a danger of people making decisions based on limited facts.

“You see a lot of groups that are forming without staff, without propositions but with a summary of what they think they will be able to do.”

Despite the dangers, Burgess believes the single adviser joining up with a larger group is a trend that is going to grow.

“I think we will see not only advisers joining larger FAPs, but we will see FAPs buying each other, merging, some will sell off product lines, some will buy product lines. I think we will keep seeing that over the long term.”

The merging markets will also create an opportunity for product development, according to Burgess, who predicts that the newly merged FAPs will have enough power to begin offering fresh product lines to the market.

Overall, Burgess believes that this shift will be a positive one for the regime.

“I think we are already seeing a shift in dynamic in the sense that we are getting new faces into the industry. It will be attractive to younger people.

“There also seems to be a lot of money floating around. The new regime will attract new capital, new innovation, and new business models.”