A new report from Insight Discovery found that UAE residents are calling for advisory firms to improve their transparency
Recruitment and credit card companies and real estate agents have the worst reputations among UAE residents, according to a new report from Dubai-based consultancy Insight Discovery.
According to the statistics – which were drawn from a pool of 1,000 UAE residents – 24 percent of respondents identified recruitment companies as the least reputable, followed by credit card companies and loan agents (18 percent), call centres (12 percent), and real estate agents (11 percent).
Six percent of respondents identified advisers from banks as the least reputable, compared to 5 percent for independent financial advisers.
While advisers were found to be far more highly regarded than the other seven professions considered in the survey, respondents who were single were twice as likely to consider them as having the worst reputation as married respondents.
Independent financial advisers are also viewed particularly poorly by people who earn between AED 65,001 and AED 70,000 per month, with 29 percent of respondents in this income bracket saying that they view these advisors as the least reputable.
The report also noted that in many cases, the nationality of financial advisers matches those of the wealthier expats whom they service, and that the number of advisers working in the sector has shrunk dramatically over the years.
“Our survey amongst UAE residents proved that financial advisers have been working in a challenging environment, which explains why there are fewer advisers working in the UAE,” said Insight Discovery CEO Nigel Sillitoe.
According to the research, 39 percent of UAE residents believe that the image of advisers can be improved by increased transparency on fees and commissions, a tougher stance on regulations in relation to scams and unregulated firms (37 percent) and industry-recognised qualifications for advisers (15 percent).
“One exciting development, which will help advisory firms who want their perception to improve, is that the demand from UAE residents for more transparency will soon be addressed as the Insurance Authority, which regulates insurance brokers, has introduced draft regulations which proposes a cap on commissions for lump sum investments and fixed-term contractual plans,” Sillitoe added.
The draft also issues guidelines on the selling of insurance and investment products to safeguard customers and stipulates that advisors must provide customers with a detailed schedule of fess and commissions to the duration of a policy’s life cycle.
“Most leading advisory firms welcome these changes, therefore it is clear that the financial advisory industry in the GCC countries is changing for the better, although there is some way to go still,” Sillitoe said.