Direct-to-consumer platform Rplan has said that it will reveal all charges and commissions investors will pay for an investment product in pound terms before making the decision to buy, claiming it is the first platform in the UK to offer full transparency over costs.
Although most providers disclose charges as a percentage, Rplan said it can be hard for customers to work out how much they pay in pound terms and that the information is never displayed at point of purchase.
Andy Creak, director of Rplan, said: “Finding out about charges at point of purchase, after purchase or not at all does nothing to earn the industry the trust it needs, nor does it respond to the wishes of the majority of Isa customers that say they want charges and commission made clear before they make a purchase decision.”
The move follows research by commissioned by the firm and carried out by YouGov, which surveyed more than 2,000 people as to when in the buying process they would like to know about charges and commissions they pay for their Isa.
Almost half of stocks and shares Isa customers wanted charges and commissions to be clearly labelled at the online browsing stage. A further 11 per cent wanted charges to be apparent when they added products to their basket. Just under a quarter said they would like to see charges and commissions clearly labelled by point of purchase.
Five per cent were happy to wait for their annual valuation statement to see charges and commissions, while four per cent were happy with seeing charging information for the first time on their contracts, after they had made a buying decision.
Mr Creak added: “It is outrageous that millions of investors think they are investing for free when in fact they are paying thousands in charges over the life of the product.”
