You can read the full report here: https://www.fca.org.uk/publication/market-studies/ms17-1-2.pdf
Key points
FCA places value for money front-and-centre of its interim findings
Wide variation in charges paid by investors, with some platforms charging more than double the cheapest alternative
Regulator acknowledges competition is generally working well for consumers, but there is significant room for improvement in how charges are presented
Industry needs to reduce times to switch platforms and exit charges may be banned
Andy Bell, chief executive at AJ Bell, comments: “The FCA has placed value for money right at the heart of its review of the platform market. This is absolutely the right approach because even small differences in the price customers pay can have a huge impact over the long-term.
“The FCA highlights that revenue earned by investment platforms per £ of AUA ranged from 22bps to 54bps*. As the spotlight inevitably turns onto charges, this will drive price competition which we welcome.
“Complexity of charges is also a focus of the interim report. We addressed this point some time ago by having an online charges calculator on our AJ Bell Youinvest website (www.youinvest.co.uk) which not only converts our charges to a monetary amount, but also compares them with the market leader**.
“Transfer times between platforms can be painfully slow and the process frustrating for everyone involved. As a net receiver of transfers we have been fully behind the FCA in driving improvements into switching times, but for every transfer it takes two to tango. The collaborative approach adopted by the FCA here is spot on and should ensure workable improvements to the existing framework are brought forward quickly.
“Investors now expect to be able to move money and change providers seamlessly without being out of the market or have their assets in limbo, unable to be sold should investment markets take a turn.”
*See FCA Platforms Market Study, p72: https://www.fca.org.uk/publication/market-studies/ms17-1-2.pdf
AJ Bell’s current revenue margin for 2018 is 20.5bps; above figures from FCA report are for 2016
**See https://www.youinvest.co.uk/charges-and-rates for the charges calculator