Financial advisers most trusted source in UK finance, study shows

Financial advisers have trumped banks and other financial services institutions as the most trusted financial sources in the UK, according to new research from the University of Nottingham.

In a study of ‘trustworthiness’, conducted through interviews with more than 1,400 adults in January and February, advisers earned the highest score of trustworthiness on a scale of 0-100, where a score of 50 indicated an organisation was neither trusted nor mistrusted and a score of 75 showed a moderate level of trust.

Independent financial advisers earned a rating of 82.4 out of 100, compared with banks which scored 75.8 and credit card companies which scored 74.1.

The overall Trust Index score for 2009 was 75.02, representing a moderate level of trust among consumers for the providers of their financial products and services.

Professor Nigel Waite, who led the research, said the average score had masked ‘significant variations’ in trust scores of individual companies whereby some had scored ‘well in excess of the mean whereas others fall far short’.

There had also been marked variations in overall trust levels among different demographics of the sample, with women found to be more trusting than men and older age cohorts more trusting than younger ones.

He added that face-to-face methods of serving customers had also resulted in much higher levels of trust than situations in which the relationship had been managed purely via the internet and speculated that this could have lessened the effects of adverse publicity.

‘In this regard the banks’ branch networks may well have mitigated the effects of the adverse publicity to which their consumers have been exposed,’ he said.

Chris Cummings (pictured), director general of the Association of Independent Financial Advisers (Aifa), said personal contact was key to solid financial planning and urged other financial institutions to follow the financial advisers’ lead on providing a personal delivery.

‘This face-to-face contact, and the more individualised nature of this service, underpins the relationship typified by the IFA. It also suggests that other financial organisations may need to pay particular attention to the extent to which service delivery is de-personalised.’