New customers using Elevate will see their prices increase following Standard Life's take-over of the platform.
French insurance giant Axa announced its plan to sell Elevate to Standard Life in May and last month Standard Life completed its acquisition of the platform
It revealed shortly afterwards that it planned to keep Elevate as a standalone platform.
Today (14 December) it announced that from March next year, charges for new clients using the Elevate platform will increase by 0.04 per cent on average.
Standard Life said this fresh charging structure for new customers will help ensure Elevate’s business model is “commercially sustainable” as a standalone platform.
This increase in charges will also contribute to the company investment plans, which are focused on delivering the developments requested by advisers in recent research by Standard Life.
For existing customers, however, the group confirmed charges on the platform will not change, and could even be cut due to the growing range of discounted fund deals.
Existing customers will also be free to move to the new charging structure if it is beneficial for them to do so.
Steve Owen, Elevate’s head of proposition, said: “It was important for us to reassure advisers as soon as possible, by removing uncertainty around pricing and supporting their client conversations.
“Advisers now know their existing clients will not see an increase, and the platform has clear focus and ambition, with a fair pricing model to support this."
|Simplified and sustainable charging for new customers|
|Value of Elevate portfolio||New Elevate Portfolio Charge*||Access to discounted funds?|
|£1.5m - £2.5m||0.25%|
|*annual equivalent of the charge based on the value of a customer’s Elevate portfolio regardless of tax wrapper|
The number of charging tiers on the Elevate platform has reduced from seven to four to try to give advisers and their clients a clearer view of what they have to pay.
In November, Standard Life launched a consultation with advisers to try to ensure Elevate develops in a way that will support their businesses.
David Tiller, Standard Life’s head of adviser and wealth manager propositions, said: “Platform provision is a long-term business so we have ensured the new charging structure is both competitive and sustainable.
“In making this change, we are also making a commitment to Elevate advisers to deliver the developments they want for their clients.”
Mr Tiller said it is right that advisers should demand that their platform provider offers the most competitive price possible.
But he argued it is “equally important” advisers feel confident in the commitment of their provider and the stability of the service provided.
Patrick Connolly, certified financial planner at Chase de Vere, said: "There is intense competition in the platform space and this will no doubt lead to further consolidation and a reduction in the number of providers."
To be sustainable, he said providers need to get the right combination of sufficient assets, appropriate and competitive charges, and a good level of service.
Mr Connolly added: "It is sensible that Standard Life has been reviewing this mix in relation to the Elevate business."