Platforms that are behind paperless times revealed

Platforms that are behind paperless times revealed

Platforms are still too reliant on paperwork, telephone calls and signatures, a report by the Lang Cat has found.

The consultancy firm has said platforms run the risk of being left behind if they continue to rely on processes which were born before the Internet age.

After reviewing 15 adviser platforms, the Lang Cat found in many cases they continued to operate on a combination of signature-based paper and telephone processes, rather than providing a fully digital service.

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It looked at processes including setting up investment products and withdrawing money.

Terry Huddart, market analysis manager at the Lang Cat, said: "On one hand, advisers, especially new-school ones, expect things to be done online.

"On the other, platforms, despite generally positioning themselves as technology outfits, are to varying degrees still mired in old-school financial services processes.

"A big part of what is holding things back is security and we understand that although platforms may be at the vanguard of technology-based financial services, they also need to safeguard client money and that is not child's play.

"We know that there is work going on in this area, but some platforms need to push it higher up the agenda or advisers could start voting with their feet."

Some 80 per cent of platforms did not require any form of analogue process for an Isa top-up during onboarding, but more than two thirds demanded one for bond top-ups.

Re-registration and transfers were the processes which lacked the most support - though the Lang Cat acknowledged this may be because platforms are reliant on the processes of another provider.

But the Lang Cat's report highlighted that the issue was not black and white, because some platforms choose to rely on signatures and paperwork to enhance security.

The Lang Cat's report stated: "We are perfectly aware that it is easy for us to sit on the sidelines and announce that there is too much paper in the industry.

"However the level of fraud that takes place, or is at least attempted, via platforms is significant - and much greater than you probably think.

"Platforms are not just tech propositions that we all expect to deliver the fancy, cutting-edge stuff. They are also regulated businesses charged with safeguarding client money and ensuring that criminals don't use them for nefarious purposes."

The platform which the Lang Cat found required most paperwork or signatures was Ascentric, which only offered signature-free processing for fund switching and model portfolio rebalancing.

Meanwhile Standard Life Wrap didn't demand a signature for any processes at all.

A spokesman for Ascentric said: "As part of our ongoing upgrade to Bravura's Sonata technology, we'll be introducing the ability to offer many more signatureless processes.

"However both client security and cyber security are top priorities for us, so just because we can offer signatureless processes doesn't mean we always will.