Four in five (81%) IFAs expect the size and value of fines facing financial services companies for poor management of their information to increase over the next five years, a new research from EDM Group reveals.
According to the report, 28% of 240 IFA respondents are ‘concerned’ or ‘very concerned’ about the ability of financial services companies to manage and store the information they receive.
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Alarmingly, the research reveals that IFAs believe the ability of financial services companies to manage their information is going to deteriorate. Nearly 22% of the respondents said they expect to see a significant increase in the number and size of fines inflicted on the sector over the next five years because of this, with a further 59% expecting a slight increase here – only 3.6% anticipate a fall.
Over half (51%) said they also expect to see an increase in the number of financial services companies they avoid because of their poor information management systems.
In terms of which financial services sectors are the worst at managing and storing their information, 49.1% of IFAs named the banking sector. This was followed by the mortgage industry (18.3%) and general insurance (14.2%).
Sam Ferguson, CEO at EDM Group said: "Our findings are alarming. Competition in the financial services sector is increasing and their customers are becoming more demanding in terms of the services and products they want. In meeting this challenge, financial services companies have to cope with a huge increase in the volume of information they receive, and how they receive it.
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By GlobalData"Banks, asset managers and insurers need to become much more efficient in how they manage their information, but our survey suggests that in trying many will fail and increasingly break regulatory guidelines."
