Broking firms and fund managers in the UK market are facing what could be the biggest change to the way they do business since Big Bang in 1986 and the abolition of its fixed-commission structure.

Proposals put forward by the Financial Services Authority (FSA) last week will cut the umbilical cord that has sustained the profitability of the UK brokerage industry for years. If the FSA gets its way, the commission paid to broking firms will be "unbundled", so that only dealing costs can be passed automatically to fund management clients.