You might have seen a photo doing the rounds this week that perfectly sums up Britain. The image, which went viral courtesy of our industry’s very own Martin Bamford, shows two men tucking into a well-deserved full English, as they enjoy their new post-pandemic freedoms – and April’s typically oddball weather.
After a year of lockdown, nothing, it seems, will deter the British public from some long-overdue pub and grub fun. For further proof, just head to a DIY store – where you’ll see hordes of people engaging on an increasingly urgent mission to get their house in order (or more accurately their garden) in time for the inevitable flurry of newly permitted BBQs.
As we emerge from lockdown at the same time as we kick off a new tax year, I’d be willing to bet that more of us are engaging in a financial spring clean, too. For many, the pandemic has deepened financial insecurities, while also creating time to think and research their financial concerns – leading to a surge in direct investing, as well as a rise in the numbers seeking qualified financial advice.
Whether the financial spring clean is done alone or with help, one thing is for sure; the cost of investment platforms will come under the microscope.
Research by Candid Financial Advice for this weekend’s Sunday Times showed the impact that platform fees can have on a portfolio – and the potential value that can come from transferring assets from one provider to another. “Fees are a key consideration when investing”, advised CEO Justin Modray. “Check how much you are paying and don’t be afraid to move.”
But while platform transfers make a lot of sense in theory, in practice they can mean a whole lot of struggle and strife…
An Investors Chronicle article earlier this week showed just how much grief platform transfers can cause. Despite advances in technology, transfers can still drag on for months – in some cases even years. And in the meantime, advisers and their clients alike are often left completely in the dark as to what’s going on.
The article points to several examples, but two in particular caught my eye, as they demonstrate the human and emotional cost of endless delays and infuriating admin.
One is from a 75-year-old, whose relatively vanilla portfolio still required plenty of paper forms and an expected 12-week lead-time (which has in any case now passed).
“What is really annoying” he says, “is that both platforms seem to be understaffed to handle transfers, and seem to expect me to do all the chasing required to get the transfers completed.”
A second investor, meanwhile, told the journalist how he “has spent hours on the phone chasing the transfer, which has been ‘demoralising, worrying and infuriating’.”
The transfers process is powerful proof that today’s investment infrastructure is broken.
Despite the leaps and bounds made by companies like Altus, whose transfer gateway allows for assets to be electronically transferred from one provider to another (so long as they integrate!), still too much of the process is paper based.
Platforms employ large teams of hard-working transfer staff, whose job it is to oversee the slow and painful movement of assets through the pipes, all the while fielding queries from increasingly frustrated advisers.
And it’s not just the plumbing that needs fixing, the presentation, too. A huge amount of stress is caused simply because the information that advisers and their clients crave isn’t made available. It’s not that it doesn’t exist – providers have it – it’s just not shown to them.
That makes no sense to me. And so I’m really excited by the new ‘transfers workbench’ that the team have been hard at work building over the last 8 weeks.
It lifts the lid on the transfers ‘black box’, to give advisers using Seccl-powered platforms a real-time, always-updating view of exactly where their clients’ assets are in the journey. (It also lets advisers edit book costs themselves – tackling a very specific but significant pain point in the adviser-led transfers journey.)
The result? Platforms and the advisers using them enjoy massive efficiency gains (the P1 Platform has already reported a 50% reduction in transfer-related queries), while end clients are spared the agonising insecurity of not knowing what’s happening to their money.
It’s just the latest move in our mission to rebuild the infrastructure of investments and advice – creating the seamless, paperless, efficient and highly affordable investment journeys of the future.
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