Sesame gives members option of spreading Financial Services Compensation Scheme (FSCS) interim levy over two years

Sesame is helping to ease the financial burden on advisers caused by the FSCS’s additional levy by offering its network members the opportunity to spread the cost over the next two years. 
This is the first time that Sesame has offered its members a two-year payment option, which is double the existing 12-month instalment option that is the most popular method of paying regulatory fees by firms in the network. Sesame is now in the process of writing to members with full details of the options available.  
Nick Kelly, Managing Director, Distribution, says: “The substantial additional FSCS levy is a body blow to advisers, given the economic and regulatory pressure that firms are already under right now. The fact that the FSCS is demanding that the levy is paid within 30 days is further compounding the issue. Sesame is responding by using its financial strength to alleviate the pressure on our members. 
“However, what we also urgently need is a fairer long-term solution for how these FSCS fees are allocated across the financial services industry in the future, as the current trend of fewer advisers sharing the burden of higher fees is simply unsustainable. In our view the FSCS is levying the advice profession for failings that occurred in the provider and fund management sector. This is unjustified and it is increasing the burden on good competent advisers.
“That is why we are working hard to ease the financial burden for our members, along with the regulatory burden, by challenging the FSA and FSCS on the way in which the levy is structured in the pursuit of a fairer long-term solution.”
Commenting on the FSCS interim levy, John Coles, Finance Director at IFA firm Beard & Coles in Aldermaston, says: “The size of this additional FSCS levy and the rationale behind it are appalling for IFAs, so it is good to see Sesame stepping in to help. The FSCS levy is hitting us during a difficult period when forward looking firms, such as Beard & Coles, are moving away from initial commission towards fee-based and trail income, so the last thing we need are sudden financial shocks such as this.”