Old Mutual platform switch prompted by cost overruns

"As is well known, the sums involved are eye-watering – we reckon, based on OMW’s own cost predictions, the replatforming cost so far for each customer is in the region of £800, and with 400,000 customers that’s a hefty bill."

This is more than double the figure the Lang Cat estimated it would cost platforms to move each client across to a different tech provider.

"Today is a very bad day to be IFDS and a very good day to be FNZ. The question is what kind of day is it at OMW?

"In one sense, decisive action is good and there is no reason that FNZ can’t deliver a coherent proposition which addresses the key gaps in OMW’s functionality.

"In another, you have to ask how things could get this far down the line before the hard decision was made."

Mr Polson also pointed out that there is no recorded instance of replatforming going well.

Tony Catt, compliance consultant at TC Compliance, pointed out that many platforms are in the throes of replatforming to offer better functionality and security for clients, while trying to keep costs down.

"The new provider appears to be a huge cost-saving, although OMW seems to have spent an awful lot of money on this exercise already.

"I guess it is hoped that FNZ will provide what OMW needs," Mr Catt said, adding the "proof is in the pudding".