The Personal Finance Society is to step up its campaign for a second Financial Advice Market Review this year to tackle a potential worsening of the ‘advice gap.’

The professional body with 40,000 members said the Coronavirus pandemic would change the need for advice and exacerbate the advice gap.

The advice gap was identified in 2015 as the gap between the potential consumer demand for financial advice and the ability of the advice profession to meet this demand.

Keith Richards, chief executive of the Personal Finance Society, said the need for advice will be greater than ever in future and the FCA needed to review this challenge.

The impact of vaccines and treatments and the UK’s exit from the EU were changing the landscape, he said.

Mr Richards said financial advisers would have to adapt quickly to a changing environment and “come up with solution(s) for clients who will have very different experiences of Brexit and Covid-19 measures depending on the sectors they work in.”

He said: “Helping them and their families to adapt to significant economic change will be a big challenge. As the economy comes to terms with the extra borrowing brought about by Coronavirus - £296 billion and counting – there are inevitably going to be fiscal measures designed to tackle the burden of borrowing.

“As a professional body, we recognise there is unfinished business on the regulatory front, which will come out as the FCA progresses with its review of the investment market.”

He said the advice gap identified by the Financial Advice Market Review in 2015 still existed as does the volatility of professional indemnity premiums and the Financial Services Compensation Scheme levy.

He added: “These will have to be replaced by a less volatile consumer funding mechanism if we are to stand any chance of closing the advice gap and ensuring everyone who would benefit from financial advice is able to access it.”

In March 2020, before the lockdown, the Personal Finance Society wrote to the FCA and the Treasury calling for a second Financial Advice Market Review.

The professional body’s letter highlighted that the original Financial Advice Market Review recognised back in 2015 that there was an advice gap that needed to be filled, but five years on many of the issues identified as limiting the supply of financial advice remain “unsolved and, in some cases, have got worse.”