The UK’s financial advice market is changing fast, with a sharp rise in mergers and acquisitions (M&A) reshaping the industry.
One of the latest and most notable deals — the planned merger of Mattioli Woods and Kingswood, both owned by Pollen Street Capital — shows how quickly the sector is consolidating.
Supporters say this brings benefits like efficiency, better service, and stronger infrastructure.
But it also raises concerns about what’s being lost — particularly the independence of advice.
There’s a clear reason behind this wave of M&A. Regulatory costs have steadily increased over the past decade, making it tough for smaller, independent firms to keep up.
For many, selling to a larger player is the only way to stay afloat.
At the same time, private equity firms are pouring money into the sector, seeing reliable profits from client fees and long-term relationships.
With scale comes the potential to invest in better technology, more training and a wider range of services
Larger firms, especially those backed by investors, are focused on gaining scale and market share.
With that scale comes the potential to invest in better technology, more training and a wider range of services — all of which could benefit clients with smoother processes and more competitive pricing.
But with size comes a shift in how advice is delivered.
The UK advice market has always been split between independent advisers — who can recommend products from across the market — and restricted advisers, who are limited to a specific set of providers, or even only their own.
In theory, both models can work well. But M&A often pushes firms toward restricted advice.
This allows for more control and consistency — and better profit margins — but limits client choice.
Independent advisers are better placed to offer truly unbiased recommendations
That’s not always obvious to consumers, many of whom assume they’re getting impartial advice, even when they’re not.
The issue isn’t just about how many products are available. It’s about trust.
Independent advisers are better placed to offer truly unbiased recommendations, even though they face commercial pressures too.
Restricted models can be well-run, but there’s a risk that advisers will steer clients toward options that suit the firm’s business model more than the client’s financial goals.
Of course, there are benefits to larger firms. They tend to have stronger back-office systems, more robust compliance teams, and the ability to hire specialists.
Clients with simpler needs may get good outcomes from a restricted adviser, especially if the service is efficient and clearly explained.
As mergers continue, the advice market is becoming more centralised. This increases the need for transparency
The problem is when the difference between independent and restricted advice is glossed over.
The Financial Conduct Authority (FCA) requires advisers to state which type of advice they offer.
But this information is often buried in documents or hard to understand, leaving clients unclear about what they’re actually paying for.
As mergers continue, the advice market is becoming more centralised. That’s not necessarily a bad thing, but it increases the need for transparency.
Clients need to know whether their adviser is truly independent or tied to a smaller product range.
Firms must be upfront about their business model — and regulators need to ensure that this distinction is communicated clearly.
The direction of travel in the UK is clear: more M&A, more scale and more restricted models. But that doesn’t have to mean lower standards.
The direction of travel in the UK is clear: more M&A, more scale and more restricted models
The industry must stay focused on putting clients first — not just through good service, but through honest, transparent advice that meets individual needs.
If independence continues to disappear, it shouldn’t happen quietly.
It should prompt a broader conversation about how financial advice is delivered — and whether the system is still working in the best interests of the people it’s meant to serve.
In the race to build bigger advice firms, client trust and choice must not be left behind.
David Ogden is head of compliance at Sparrows Capital
