Advisers <3 Platforms and other news

By Next Wealth | 02 April 2020 | 4 minute read

Over the past few weeks, we have all come to rely even more heavily on technology for our work and to stay connected with friends and family. This reliance has meant that cracks in our technology infrastructure have in some cases become chasms.

Just before the Coronavirus crisis, we completed some research with advisers on the technology they use in their businesses. Platforms earned the highest ratings from advisers followed by cash flow modelling. Back office systems scored worst.

Platforms were praised for offering the best value for money and again, back office systems scored worst.

The biggest frustration was with integrations. Across all types of adviser tech, the lowest scores were for integrations (compared to value for money, service, and willingness to recommend).

We’ll be sharing more about our adviser tech report in a free webinar next week. There are only a few spaces left but if you email us we’ll send you the recording.

The failure of adviser tech providers to effectively integrate has led some firms to return to a single source model, relying on a single provider to supply their firm’s tech, and risks stifling innovation.

We think the industry needs to move to support open APIs and data standards for the integrated systems approach to work. This will help advisers deliver a modern customer journey. But that is a medium term challenge. There are short-term issues that now supersede integrations.

Some of the niggles and frustrations that advisers have with platforms have become massive challenges as we adapt to working from home.

Platforms have been slow to adopt e-signatures. Most have now relaxed rules to accept scanned copies of forms so that advisers can collect paperwork without physically visiting a client and without relying on the postal system. (We’re putting together a list of forms showing requirements for signatures by platform. We’ll post it to our website but you can email us now to request a copy.)

The other issue is with time out of the market. The current market volatility means that it is risky to rebalance portfolios. Clients risk being out of market for three or four days. Another issue is with wrap transfers. With a fresh ISA allowance coming up, advisers worry the timing is wrong to move money from a GIA to an ISA. As far as we know, only Transact offers in-specie wrap transfer. More need to offer this – and soon!

Out of market risk is even bigger with pension transfers. A transfer from a closed book pension provider could mean a client is out of market for ten or more days. Advisers are telling us they are postponing taking on new clients until the second half the year to reduce risk.

So, while technology is playing a more important role than ever, the shortcomings are being felt more than ever. Platforms are moving quickly to address the issue of wet signatures. When we come through the crisis, let’s try to solve some other thorny issues such as out of market risk and data integrations.

In the meantime, from all of us at NextWealth, stay safe and stay healthy.

NextWealth Live – 23 March 2021
We have postponed NextWealth Live to 23 March 2021. We have contacted delegates and sponsors to offer refunds or carry forward tickets to next year’s event. If for some reason you haven’t heard from us, please get in touch.

NextWealth update
Cash management: we have long-said that there is a structural shift to cash as well as a short term flight from risk. We are publishing a report on cash management providers this month. Get in touch for details.

Events calendar: We are compiling a list of wealth management industry events to share with event organisers to help firms reduce the risk of overlap and duplication. With so many events being cancelled due to the COVID-19 pandemic, the autumn is turning out to be very busy for events. Firms that share their events schedule will receive the full calendar that we compile. Please contact Hannah to share details of your events schedule

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