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Topics: Transact| wrap platforms| Ascentric Wrap| FSA
Transact has told advisers it is not looking to expand into the direct to consumer (D2C) or workplace savings markets and will instead focus solely on the IFA space.
In an adviser update, the UK's first wrap dismissed the emerging D2C and workplace savings space as "experiments in developing markets" triggered by the platform industry's rush to find new outlets.
"We have looked at the developments likely to emerge in the areas of workplace savings, direct to consumer and affinity group offerings...but they have no real connection to Transact's raison d'etre," said Transact marketing director Malcolm Murray (pictured) in the adviser update.
"I am convinced the greatest opportunity is still to look after the needs of the quality independent financial adviser."
Murray's comments come as rival wraps Elevate and Ascentric recently unveiled plans to launch D2C offerings in a bid to help advisers keep hold of "orphan clients" - or those disenfranchised from financial advice because of the retail distribution review (RDR).
He said regulatory change had prompted some players to change tack.
"There is a temptation, with all the changes that are forecast as a result of the RDR, to rush around and identify new markets and new opportunities."
But in a dig at rival wraps, he added: "We will leave these ‘experiments' in developing markets to platforms that perhaps need to find new outlets."
Murray said RDR had underlined the importance of offering a bespoke financial planning service.
Transact's bid to shore up the support of the adviser community comes on the back of the wrap being hit by a £3.5m FSA fine for client money breaches in December.
Murray said the wrap had been made to feel "humble" and "grateful" to those advisers voicing their support in the aftermath of the fine.
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| Comment | Transact scoffs at rivals' D2C 'experiments' |
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Scoff
Transact scoffs do they? Do they also chortle & wheeze and possibly fart in the general direction of other platforms D2C propositions?
Posted by: Chippy Minton
Nice try chaps
Transact has had it's 15 minutes so to speak. What defence or explanation has been provided for the errors that brought about the fine? Look at the assets of c £10 bn divided by the number of users and thinks do not look so rosy. I wish the no ill however one has to ask could they fund the developementof D2C and even if they could the majority of users could not offer the volume to generate a profit in my humble opinion.
Posted by: Mark Stokes
Response from Transact
I have been dealing with the press long enough to know that sub-editors have to be "creative" in their headlines to attract the reader's attention. Will Roberts' piece quoted an extract from our January Adviser Update perfectly accurately but any of our 8000 readers would have had difficulty in recognising the accusation that we were scoffing at our fellow platforms. (Interestingly, if you google the word "scoffing" on IFAonline you will find it is one of the sub's favourite verbs having used it in headlines seven times in recent years). We were simply setting out our marketing aims for 2012 confirming that we would not be pursuing the D2C or workplace savings markets, leaving that to other platforms who might be better placed or have more need to explore those markets. Instead, we would concentrate on the market we have served for eleven years - the quality financial planning firm - because we believe there is every liklihood that this will be the strongest area of profitable growth after 1 January 2013. In response to Mark Stokes comments I should point out that we emailed 8000 advisers within a few minutes of the FSA posting the Final Nptice on its website and explained in some detail the nature and extent of the two breaches for which Transact was fined. If he would like a copy of that email I would be happy to send him one if he would supply his email address.
Posted by: Malcolm Murray, Transact head of marketing
Transact already does D2C
I'm slightly perplexed by the general impression (even from Malcolm) that Transact doesn't 'do' D2C and doesn't intend to. In that clients already have online dealing capability which they can use at any time (and that facility has been there since launch), any IFA could already use Transact to launch their own Hargreaves Lansdown clone via their own web site. Or, allow the client an 'own management' section of the portfolio to do with as they like. Several Transact IFA users adopt the latter approach.
Posted by: Stan Kirk
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"humble" and "grateful"
Transact say they are "humble" and "grateful" for IFA support after the fine. I would question the IFA's - how do you recommend a platform that has been fined £3.5 million for client money breaches? And in line with TCF, have you discussed this with your clients who are on the platform? Some clients might prefer not to deal with a provider after this sort of thing.
Posted by: Mike