Platforms have started to rip up their rulebooks in a bid to meet advisers’ remote-working requirements, but poor or patchy service has become a growing source of frustration for many of their users.
The burgeoning coronavirus crisis sent the UK into lockdown on March 23 - effectively ending face-to-face meetings between advisers and clients for the foreseeable future.
That presented an issue for an industry that still relied heavily on the use of wet signatures. Platforms have moved relatively quickly to update these requirements - but some solutions are seen as stopgap measures little better than the processes they replaced.
On top of this, platforms contending with the need to social distance customer-facing employees from one another, and to work remotely where possible, have struggled to maintain service levels.
Matthew Aitchison, managing director of Clear Vision Financial Planning, said the crisis had exposed providers’ weaknesses – even when tech difficulties themselves are set aside.
“[It’s] not just in terms of their ability to service client and adviser requests, but also in their willingness to engage and solve problems that the existing systems may cause,” he said.
He was not alone in his criticism. “Some of the niggles and frustrations that advisers have with platforms have become massive challenges as we adapt to working from home,” NextWealth founder Heather Hopkins wrote in a newsletter to clients last week.
Logistical issues
The crisis has affected different platforms in different ways. Those with large client service teams have been presented with different logistical issues to those with a smaller number of customer service roles.
With teams now working from home, the likes of Aviva and Aegon are not currently accepting inbound calls.
Bit it is not just large platforms that have turned to online-only communications – James Hay has also temporarily suspended its contact centre, for example. Equally, some of the largest providers, like Royal London, have impressed advisers with the way they have maintained service levels.
Terry Huddart, head of proposition at the Lang Cat consultancy, said: “For the smaller platforms, it would in theory seem easier for them to adapt because they have a much smaller operation. However, larger firms will have much bigger IT departments.
“Ultimately it may come down not to size but to the skill of the operational response. But it is still early days.”
When it comes to the demands they make of advisers, platforms’ early moves have focused on eliminating pen and paper processes where possible. For most, however, the shift has not been from wet signatures to e-signatures. Instead, a temporary alternative – accepting scanned copies of documents – has been the favoured method.
Unlike wet signatures, scanned documents still require clients to sign the forms themselves, and often also involve a degree of back-and-forth between client and adviser. E-signatures, whose legal validity was confirmed by the Law Commission last September, involve a more seamless process.
However, some providers still have concerns about the risk of fraud. Nucleus said it was “exploring options” to accommodate e-signatures, but “will only do so once we fully understand the operational and security implications”.
Parmenion, by contrast, told its adviser users at the end of March that it would shift from scanned applications to e-signatures “in the next few weeks”.
Balancing accessibility with security is a key consideration for platforms. But the majority appear to have accepted the need to overhaul their practices, particularly as the shift to remote working has come at what is traditionally one of the busiest times of the year for advisers.
Flexibility
This year’s Isa season has been overshadowed by both the virus and the ensuing market volatility, but platforms have been offering workarounds to intermediaries. Ascentric is among those now taking instructions from advisers, by email or phone, for existing client Isa declarations.
It is also permitting advisers to email client authorisations for issues such as setting up new wrappers or changing existing investments.
Transact, meanwhile, is offering a similar signature-free service for existing clients wanting to open an Isa or Lisa. In this case the platform will ring clients directly following an email instruction from their intermediary. A confirmation then follows by post.
Some advisers have expressed frustration at the continued need for paper-based communications in such instructions. But Transact, like most others, said it is continuing to hone its processes. The platform is ahead of the curve on another aspect of Isa season, according to NextWealth.
“Another issue is with wrap transfers. With a fresh Isa allowance coming up, advisers worry the timing is wrong to move money from a general investment account to an Isa. As far as we know, only Transact offers in-specie wrap transfer. More need to offer this – and soon,” Ms Hopkins wrote last week.
To reduce risks relating to time out of the market, which are particularly pronounced for pension transfers, NextWealth added that some advisers are postponing taking on new clients until later in the year.
Withdrawing client assets in the age of remote working is another complication, given the risk of fraud is greater. Some platforms have what the Lang Cat terms “straight-through processing”, which typically removes the need for signatures once accounts have been opened.
Those who have previously adopted a more belt and braces approach are, once again, easing their restrictions in light of the crisis. Novia is now accepting client withdrawal instructions with an adviser signature rather than that of the client.
Sometimes it takes a crisis for real change to occur. The shifts taking place across the platform industry over the past fortnight have been replicated, to an extent, by other providers such as life companies.
So far, these overhauls have focused on ensuring advisers are not unduly hampered by the sudden transformation of working practices. Mr Huddart said some firms have adapted faster than expected – but added there was "little sign yet" of providers seizing the opportunity to innovate.
Most changes are simply bringing services in line with those offered elsewhere. And advisers have claimed there is still plenty of room for the basics to be done better, too.
As Clear Vision Financial Planning's Mr Aitchison concluded: “Some have been very much on the front foot, even if their systems haven't been particularly paperless - engaging with advisers, being visible and accountable and trying to offer quick changes in process to help.
"Others are difficult to get hold of and not at all proactive."
dan.jones@ft.com
