Advisers have raised concerns that private equity consolidation in the sector could reduce consumer choice.
Last week, FT Adviser reported on a consolidation surge in the UK independent financial advice sector driven by US capital.
A report from Heligan Corporate Finance, showed the number of US private equity firms invested in UK independent financial advice platforms rose from two in 2020 to 18 in 2025.
One FT Adviser commenter called for the government to “step in” and prevent the advice industry going the same way as veterinary care, “where a handful of large corporations dominate the market and control supply and pricing”.
They added: “It will be a sad day if we lose the small independents.”
These concerns were echoed by several financial advisers.
Nouran Moustafa, practice principal and adviser at Roxton Wealth, stressed she was not against growth or investment.
She added: “I am concerned when advice starts being treated like an asset to be packaged, scaled and sold rather than a relationship built around clients.”
She added that while private equity could bring capital, technology and management expertise, the question was always: “Who is the model ultimately designed to serve?”
Moustafa said: “My worry is not that firms get bigger. My worry is that consumer choice gets narrower and advice becomes standardised into a corporate process.”
Paul Denley, chief executive of Oakham Wealth Management, also acknowledged the benefits of private equity, but said “wealth management remains a relationship business, not a manufacturing process”.
Denley claimed many clients choose a boutique firm to avoid being part of an institution, but end up there anyway after an acquisition.
He added: “Centralised investment propositions, standardised processes and margin pressure can erode the bespoke nature of advice.”
Alex Norwood, director at N2 Asset Management, said private equity investment introduced “commercial pressures that have not traditionally been central to independent financial planning”.
Norwood added: “The growing involvement of US private equity is particularly notable, as many investors are approaching the sector with far more aggressive growth and acquisition models than the UK market has historically seen.”
Norwood and Moustafa both cited pressures on smaller firms as factors making consolidation look attractive, including rising regulatory costs, consumer duty obligations, recruitment challenges, professional indemnity insurance costs and technology costs.
However, Norwood said there remained “strong demand for relationship-led advice, continuity and genuine independence”.
Norwood concluded: “The challenge for the industry is ensuring that scale and efficiency do not gradually reduce diversity, competition and consumer choice over time.”
hereward.mills@ft.com
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