Platform firm Seven Investment Management (7IM) says it backs the FCA’s Investment Platforms Market Study and its focus on improving platform competition for the benefit of investors.
Verona Smith, head of intermediary, 7IM said: “This report puts the consumer at its core, centring around doing the right thing, making switching easier and comparisons simpler. This articulates much of how we have always run our own platform, being asset neutral in our pricing structure from the start.”
On switching, Ms Smith said: “The industry has to make it easier for people to switch between platforms. At a time when it has become so much easier for consumers to switch bank account, the platform industry has moved forward over the years, but we are still not there yet. It’s time these barriers were removed.”
On comparing platform costs, she said did not believe in “policing how platforms charge.”
Steven Cameron, pensions director at Aegon which is a major platform provider, said: “We welcome the FCA’s largely positive Investment Platform Market Study findings and the proportionate and targeted set of remedies it is now considering.
“Platforms continue to rapidly replace traditional life companies at the heart of financial services and we are pleased the FCA has found competition is working well for most platform customers.
“As in most areas of financial services, advisers play a key role in supporting customer decision marking and we welcome the distinction between advised and D2C platforms and the remedies under consideration for each.”
“As in the Retirement Outcomes Review, the FCA is exploring how to make it easier for customers without advisers to shop around. It is right to explore remedies based on improved disclosure of charges, although elsewhere the FCA has accepted that disclosure-based solutions do have their limitations.
“It’s important that individual customers, whether or not advised, don’t face undue barriers if wishing to switch between platforms and we’re pleased the FCA is awaiting improvements which should emerge from the Transfers and Re-registration Industry Group before considering if any further remedies are needed here.”
Kevin Russell, proposition director at SEI Wealth Platform, said: "This provisional paper emphasises just how crucial technology is to the success of platforms going forward in delivering good customer outcomes.
“A key takeaway within that is the regulator’s views on how the industry needs to tackle challenges around disclosure and transparency. Going forward, whatever the regulator can do to facilitate an environment where innovation is encouraged to tackle recognised issues should be welcomed and encouraged.”
Michael Barrett, consulting director at the lang cat consultancy, was more sceptical. He said: “Most platform providers will be breathing a sigh of relief as a result of the Interim Market Study. Twelve months on from the terms of reference, none of the questions asked within the original scope have been fully answered. This feels like a study looking for a sense of direction.
“Having said that, and despite customer satisfaction generally being high, it is still clear that the FCA don’t believe the platform market is working effectively. With issues highlighted for adviser inducements, fund discounts, exit fees and cash holdings there is plenty for the market to ponder, however any potential remedies are a long way from becoming a reality, and could well impact advisers who use platforms more than the platforms themselves.”