Planners shy away from outsourced services

Money Management
12 May, 2014

Mr. Cutrupi, who runs a Manila and Bangkok-based outsourced paraplanning service for Australian financial planners, said larger financial institutions providing advice have already moved down this path, but smaller planning groups have resisted the move.

“The big banks have been doing this for years and smaller practices have opportunities to reduce their costs and increase their productivity and savings,” he said.

“Even if a planner is aligned with an institution they are still running their own business and could consider outsourced services for their business.”

The Future of Financial Advice (FOFA) Reforms have highlighted the distinction between planning and paraplanning skill sets, according to Mr. Cutrupi, who said outsourced services would make planners more efficient at engaging in client-facing tasks.

“There are still bottlenecks in the creation of statements of advice which are causing delays for planners in providing advice to their clients, but outsourced services allow them to be turned around in a few days, without costing the adviser any of their own time,” Cutrupi said.

At present Cutrupi supplies paraplanning, statement of advice creation and risk insurance pre-assessment services to 35 boutique planning groups. He uses staff trained to Australian standards operating out of an office in Bangkok, and recently opened an office in Manila.

He said both offices are headed by Australian financial planners who have gained Certified Financial Planner status and oversee 12 staff operating from the two locations.

Mr. Cutrupi said the business was still growing even though it was not advertising for clients. He predicted the uncertainty around Fee Disclosure Statements and the requirements of FOFA would likely generate further business.