AR market continues to consolidate as income climbs

The UK's appointed representative (AR) market continues to consolidate, with the number of principal firms falling by 5.3% over the last year.

However, revenues generated by ARs have increased across both regulated and non-regulated financial services activities, according to Enness Global's analysis of FCA data.

The number of principal firms operating within the AR framework has fallen from 2,568 in March 2025 to 2,431 in March 2026, a decline of 5.3%. Over the same period, the total number of ARs slipped by just 0.7%, from 33,570 to 33,347. As a result, the average number of ARs per principal increased from 13.1 to 13.7, up 4.9% year-on-year.

This continues a longer-term trend of consolidation across the sector. While the number of principal firms has reduced over the last decade, the number of AR relationships has remained comparatively resilient, resulting in a growing concentration of ARs per principal.

At the same time, the commercial contribution of ARs continues to increase. Across regulated financial services activities, ARs generated an estimated £13.14bn in revenue during 2025, up 7.1% from £12.27bn the previous year.

General insurance and protection remained the largest regulated sector by revenue, generating an estimated £4.03bn in 2025, followed by consumer finance at £3.33bn, and consumer investments at £2.85bn. Consumer finance also saw one of the strongest annual increases in regulated revenue, rising by 11.6%, meanwhile wholesale financial markets grew by 12.3% and pensions and retirement income increased by 10.4%.

Growth was even stronger across non-regulated financial services activities, where estimated AR revenue increased by 8.3% year-on-year to reach £24.53bn in 2025. 

Investment management delivered the most notable increase in non-regulated revenue, rising by 51.7% year-on-year to £426.5m. Consumer investments also recorded strong growth of 14.2%, while general insurance and protection increased by 12.9%. Retail banking was the only sector to see declines across both regulated and non-regulated revenue generation.

Sector participation data highlights a mixed picture. Consumer finance remains the largest AR sector by representation, accounting for 16,690 ARs in March 2026, followed by consumer investments at 7,313 and general insurance and protection at 6,816. While consumer finance and investment management both recorded annual growth in AR numbers, general insurance and protection saw a decline of 4.8% year-on-year.

Islay Robinson, CEO of Enness Global, commented: "The latest data shows that consolidation within the AR market is continuing, but importantly this isn't a story of contraction. While there are fewer principal firms operating today than a year ago, the revenue being generated by ARs continues to grow across both regulated and non-regulated activities.
 
"That suggests the market is becoming more efficient and increasingly concentrated around larger, more established principal firms with the infrastructure and expertise to support high-performing brokers.
 
"For experienced advisers and finance professionals, the appeal of the AR model remains clear. It provides a route to operate within a regulated framework without the administrative and compliance burden that comes with direct authorisation.
 
"What we're seeing is an evolution of the model rather than a reduction in demand. The most successful AR networks are those that can combine robust regulatory oversight with commercial flexibility, allowing brokers to focus on serving clients and growing their business."