The newest FCA report on the recommendation market has revealed a 13.9% 12 months on 12 months improve in retail funding intermediation income in 2025 to £6.5bn regardless of a decline within the variety of funding advisers final 12 months.
The variety of adviser corporations has declined sharply in recent times, with the quantity down by 630 since 2020 to 4,872 in 2025, with consolidation and mergers a possible issue.
The FCA’s Retail Mediation Actions Return report, printed this week, suggests a long run pattern of rising income within the retail funding sector however a gentle decline within the variety of advisers and recommendation corporations.
Whole regulated funding intermediation income rose from £5.3bn 2023 to £6.5bn in 2025, in accordance with the report. Over the identical interval the variety of advisers fell from 37,729 in 2023 to 37,517 in 2025, a drop of 212.
Whereas the variety of adviser corporations has fallen, the variety of purchasers served has risen significantly. In 2020 recommendation corporations served 3.577m purchasers. In 2023 this had risen to 4.034m and in 2025 it rose once more to 4.158m. Recommendation corporations are serving practically 600,000 extra purchasers than they had been two years in the past, the FCA information confirmed.
Recommendation corporations are actually onboarding greater than 500,000 new purchasers a 12 months and that is greater than the variety of purchasers who depart (see Desk 23 under).
Whereas the information supplies an in depth perception into the adviser sector, the FCA has identified that in 2025 it modified the methodology it makes use of to organize the information and classify corporations and has added that, “in consequence, some corporations could have modified class, so information earlier than and after 2025 will not be comparable.”
Whereas the methodology and classifications could have modified the broad developments and figures present a helpful perception into the form and route of the sector.
Key findings from the report:
• Reported income from retail funding intermediation elevated by 13.9% to £6.5bn in 2025, in comparison with 2024
• Of the corporations offering retail funding recommendation in 2025, 88.1% supplied solely impartial recommendation, whereas 10.6% supplied solely restricted recommendation
• The proportion of corporations that supplied each restricted and impartial recommendation was 1.3% in 2025, in comparison with 1.4% in 2024
• Income from non-investment insurance coverage distribution in 2025 elevated by 6.4% to £27.7 billion, in comparison with 2024
• The reported variety of mortgage adviser posts fell to 32,990 in 2025 in comparison with 34,342 in 2024.
Chosen key tables from the FCA Retail Mediation Actions Report 2025:
Supply: FCA RMAR 2025
Supply: FCA RMAR 2025
Supply: FCA RMAR 2025
Supply: FCA RMAR 2025
Supply: FCA RMAR 2025
• FCA Retail Mediation Actions Return 2025
Monetary Planning Right now Evaluation: The FCA’s Retail Mediation Report for 2025 reveals a sector doing very effectively financially however with some regarding underlying points that have to be tackled. On the optimistic aspect income is up considerably for the retail funding recommendation sector and the variety of purchasers is rising strongly too. All of this may drive profitability. On the much less optimistic aspect, the variety of advisers is declining and has been for a number of years, albeit gently. Extra worrying is that the variety of impartial recommendation corporations has fallen by over 600 since 2020. After all, many will say that so long as profitability stays excessive and income is rising all is effectively. That is one interpretation and positively the demand for Monetary Planning appears to be rising strongly however the decline within the variety of advisers for a supposedly quickly rising occupation will not be an excellent look.
As Monetary Planning Right now’s personal surveys have proven, the Monetary Planning and recommendation sectors usually have more and more moved in the direction of changing into wealth managers and are focusing more and more on mass prosperous and HNW purchasers. That makes a whole lot of sense but it surely does imply that an terrible lot of potential purchasers are being left discover. The PFS Pathways to the Career marketing campaign, encouraging new expertise to enter the occupation, is one essential step in recruitment however much more must be achieved to draw new monetary advisers to make sure the present development is sustained. AI can’t be the one resolution.
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