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Dividing platform market makes life easier for IFAs: Nucleus
The growing divide among platform providers allows advisers to make a more informed decision on the model which is right for their business and clients, according to David Ferguson, chief executive officer of Nucleus.
Mr Ferguson said that the greater separation between platforms available on the market makes it easier for IFAs to choose the correct wrap platform for their clients.
He said: "As legacy providers look for a route to sustained profitability and long-term survival the platform market is starting to show clear signs of separation.
"While there has always been a real and considerable difference between true wrap platforms and what are essentially fund supermarkets this has not always been clear to advisers and the wider market."
He added: "The current climate combined with what the industry knows is coming in the form of RDR, is forcing many platform to show their true colours."
According to Mr Ferguson, currently there are legacy providers acting as a distribution channel for funds, paid by the fund manager, and other open architecture providers providing an administration service to the client and the adviser, paid for by the client.
He said: "Naturally both approaches have their place but advisers need to understand the fundamental differences between the two propositions and appreciate that the former's interests are not necessarily aligned with them or their clients.
"The very public negotiations taking place between two of the largest platforms and the fund management industry is highlighting these differences and giving advisers the sort of insight they need when asking themselves which model is best for them and their clients."