Aimed at UK residents, the launch is part of Momentum’s effort to position itself as a “UK pension provider within the next 12 months rather than just a Qrops specialist”, Paul Forman, the company’s director and head of sales for the UK and EU, told International Adviser.
The firm will also offer UK-based clients the option of tranferring their Sipps into a Qrop, free-of-charge, if they move abroad – although in both cases the products need to be a minimum value of £40,000 ($56,635, €50,454).
Describing the free transfer feature as a “unique proposition in the UK”, the group’s chief executive Stewart Davies said: “Adviser feedback was telling us there is an increasing need for a Sipp that allows flexible, multi-jurisdictional switching.
“The Momentum Sipp is the first in the UK to offer this, and with our quality discretionary fund manager partners we are confident that we have created a fully flexible product that advisers can recommend to their clients.”
The new Sipp gives clients access to investments via 12 discretionary fund managers, making it a simpler and cheaper alternative to its existing full Sipp service, said the firm.
Strategy shift
The launch signals a shift in strategy for the firm, which until recently exclusively provided offshore pensions in the form of qualifying recognised overseas pension schemes (Qrops) with offices in Malta, Gibraltar and the Isle of Man.
In October 2014, Momentum acquired a 50% stake in Manchester-based Sipps provider Calderwood Pensions in a bid to extend its product range and offer its expat clients the option of opening a FCA-regulated Sipp rather than a Qrops.
Forman said 750 of its expat clients have chosen this option since the buyout, encouraged by the UK’s pension freedoms which were introduced in April last year.
He hopes the next product will boost its UK Sipps clients from 1,000 to 5,000 in the next five years and increase its $1bn of assets currently under management.
It comes as an independent poll commissioned by the pension specialist, found that out of the 106 financial advisers it questioned, 51% said they were expecting an increase in enquiries to open Sipp accounts, with three-quarters of retirement specialists predicting that their Sipp business will grow by up to 40%.
Fees
The new offering will have an annual fee of £250. The cost of transferring into a drawdown is also £250, while the annual income drawdown fee is £100.
The 12 DFMs available through the Sipp are Bordier, Brewin Dolphin, Brooks Macdonald, Brown Shipley, Investec, Nedbank, Quilter Cheviot, Rathbones, SVS Securities, TAM and Tilney. Momentum said it plans to offer a more bespoke platform service in the near future.
The product will go live next week.
