More transactions on Astute despite volatility in the financial adviser corps

The financial services industry continued to lose experienced financial advisers over the past year, as well as new entrants who found it difficult to survive in the tough economy. However, aggressive recruitment on the part of life offices helped to keep their sales force numbers relatively stable.

These were amongst the findings in a recent industry survey by Astute, the company that integrates data from financial services product providers for use by advisers when undertaking authorised financial planning for their clients.

The Astute study covers financial advisers in the life insurance and investment industry, including life office agents, bank employees and independent financial advisers (IFAs), all of whom have had to adapt to strict regulation and entry criteria, and difficult operating conditions due to the weak economy. Most of the industry’s new entrants have been recruited by life assurers.

The survey found that Astute had made considerable progress in expanding its offering to the professional financial advisory market, which increasingly regarded the company as an essential business partner. Astute’s user base remained steady at around 19 000 financial advisers and administrative staff in South Africa and Namibia.

According to Astute Managing Director, Biddie Biddulph: “Advisers, whose services are desperately required given the propensity of debt burdened South African consumers to avoid saving, face major challenges due to the fluid socio-economic and regulatory environments that have a direct impact on their activities.”

The frequency with which advisers requested customer information from Astute increased, pointing to higher levels of marketing activity by product providers, as well as consumers adjusting their portfolios as part of prudent financial planning in the wake of the global economic crisis and market volatility.

Biddulph said advisers were increasingly using technology to improve efficiencies and to comply more easily with regulation. Growth in the range of products for which information is available on the Astute platform has also made a positive difference to the higher level at which intermediaries transact via Astute.

“We’ve expanded our service offering and can assimilate information online from companies offering life insurance, disability and investment products. Advisers have been quick to exploit the efficiency benefits of our system as a one-stop provider of financial product information,” said Biddulph.

The Astute survey also noted a polarisation in the usage of financial needs analysis (FNA) systems, with Spotlight the preferred product. Atwork also gained market share at the expense of other players. These systems are used to analyse the data provided via Astute with a view to conducting proper financial planning for clients.

Said Biddulph: “Most encouraging was that the professional financial adviser community that relies on the quality and soundness of the information and services that we provide, continues to rate Astute highly in terms of its ability to add value to their practices.”