InvestmentsJul 31 2018

Mark Polson: Client portals are more important than you think

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Mark Polson: Client portals are more important than you think

Low trust scores for financial services don’t make any difference to the behaviour of the sector, and people keep investing, so it can’t be that. Behavioural finance biases give us some clues as to the sorts of heinous behaviour investors can engage in, and it’s advisers’ job to nip those in the bud. But there is one bias which, according to Baker, Ricciardi et al, might be worth looking at, and that is ‘worry’.

Worrying in this context tends to mean that an investor is outside their risk tolerance, and the obvious fix for that is for them to rebalance their holdings into your carefully created centralised investment proposition, of course. But what if there are other worries that you can’t prevent niggling away?

Out of sight

I think there’s a thing in here about something we’ll call ‘tangibility’. Financial services is mainly a will-o’-the-wisp; you can’t see it or touch it. It all works on trust – you trust the adviser, the adviser trusts the platform (ha!), the platform trusts the custodian, and so on. This is why blockchain has an application in this market, by the way.

But what if you don’t trust? Not in an active ‘I hate you’ way, but in a low-level susurration of lesser angels on your shoulder sort of way. We saw instances recently where, as a consequence of difficult replatformings, some clients on Barclays Smart Investor (and never was there a better disproving of nominative determinism than that) and others saw zero balances where once there was a healthy Isa. 

No one had a zero balance, and everything came back to where it should be eventually. But imagine what that does to someone who has handed off their investment to a bunch of folk they’ve never met – even if you as an adviser are involved – and their attitude to keeping in touch with their investments?

My contention is that we need to use the technology at our disposal from platforms, back offices, reporting tools or whatever, to bring investors back closer to their money. They don’t need trading access if they have an adviser, but it is surely right to let people see the seven things I popped on to the welcome screen about 1,000 words ago. We can’t dole information out like sweeties; our system is too abstract for that.

When it comes to client reporting, there are a few examples out there worthy of note. The True Potential client-side experience is nice. XPlan has a nice client portal; so does Intelliflo. Fastrak from Sprint still does a nice job; I like the Ascentric integration with it, and so on.