The problem of transfers between Isas and investment accounts is likely to come one step closer to being solved this year, as the industry prepares to submit ideas to the regulator.
The Financial Conduct Authority has asked for solutions to the problem of delays and difficulties switching money from an Isa account to a general investment account, which are exacerbated by a lack of data.
Industry experts and the regulator have now said they expect some solutions to be submitted in the fourth quarter of this year.
Paul Pettitt, managing director of Origo Services, said the biggest area of complexity is in the Isa and general investment account area. “There are all sorts of problems there, because after five years of trying to push an interoperable model, we still don’t have any information about how long they take.
“Nobody knows, once that instruction has been issued, how long it takes,” he stated, adding there have been attempts by the Tax Incentivised Savings Association, but there is no end to end view due to fragmentation.
“It doesn’t work well for consumers at the moment and we need to work out what needs to change to make it better. The FCA is looking at it and they are waiting for the industry to come back with some analysis on how this will be fixed.”
Mr Pettitt said the FCA unearthed this problem as part of the data collection exercise it carried out into the pension freedoms last year.
Ben Cocks, director of Altus, said the proliferations of new Isas could make the landscape more complicated and make the need for action more pressing.
“It is a problem, and a growing problem given the changes to Isas that more people will want to transfer,” he commented. “The FCA has gradually recognised that they are just Isas but there are many more transfers between types of Isas.”
The FCA responded that it is expecting the industry to submit its findings in the fourth quarter of this year.
