Overhauling the UK investment platforms market
By Kirsten Hastings, 21 Sep 18
AJ Bell boss calls for more disclosure, guidance, transparency and the removal of a ban
Pounds and pence disclosure of platform charges
Bell said: “The FCA is absolutely right to put value for money front and centre of the platform market study and sharpen the focus on revenue margin, expressed as the amount of revenue each platform makes in a year from each £ of assets under administration (AUA).
Revenue per £ of AUA cuts through the complexity created by different platform charging structures and shows people the level of charges each platform levies per £ invested, he explained.
“I’d like to see a requirement for platforms to publish this figure prominently on their website as £s of revenue per £100,000 ($132,176, €112,677) of investment, rather than a basis points measure.
“Based on the 2016 numbers from the interim report that would show that platform fees per £100,000 ranged from £220 per year to £540 and people could see where their platform sits on the scale.
“I’d also like to see this taken a step further with platforms required to have a calculator on their website that shows customers the annual charges that potential and existing customers will pay, in pounds and pence for year one (and year two if it is substantially different to year one).”
Bell added: “Simple online calculators like this would allow a meaningful comparison of charges with other platforms to be undertaken, before accounts are opened.”
