Blog: Platforms – are we stuck in a rut?

It is little wonder many advisers are suffering from platform fatigue.

According to the Platforum, this ‘illness’ is responsible for a paltry increase of 3.26% in platform assets under administration (AUA) for Q1.

The consultancy’s research found AUA only rose from £146.29bn to £151.58bn over the period, with smaller wrap operations reaping the rewards while larger players stagnated.

However, despite impressive gains in percentage terms for outfits like Wealthtime, the truth is the bulk of platform money lies with the big three – and for them growth was largely static.

FundsNetwork’s AUA was up 3.13% to £36.2bn, Cofunds posted a 1.81% rise to £30.9bn while Skandia is still the largest with AUA of £39.67bn following a 1.12% increase.

You could argue many advisers have already moved the bulk of client assets onto their favoured platforms but we know there are still billions of pounds sitting unproductively in legacy products which has yet to be moved. So why the lethargy?

Well, the Platforum suggests IFAs are like “deers in the headlights of the RDR juggernaut” and regulatory concerns about platform suitability are getting in the way of them making a firm decision on where to park clients’ accounts. It also believes expensive but useless features are “turning advisers off”.

In this lacklustre environment it is perhaps surprising that another provider is preparing to enter the already crowded platform market.

Close Asset Management, which is on an acquisition spree buying up IFA firms, has announced this week it is linking with FNZ to provide a multi-channel platform including direct to consumer and retail-advised arms.

This approach will undoubtedly appeal to its advisers who could be looking at providing some form of simplified advice post-RDR.

Perhaps a new player in the sector will also spur existing platform providers to look at their own offerings and come up with fresh ideas.

Katrina Baugh is editor of Professional Adviser and IFAonline.co.uk