Platform trail commission switch-off gathers pace

Advisers are increasingly shifting their businesses towards fee-based remuneratio as the platform trail commission switch-off deadline approaches, research suggests.

The majority of advisers now receive at least 75 per cent of platform revenue through fees, according to figures from Fidelity.

The firm’s FundsNetwork business found that 52 per cent of advice firms now receive at least three-quarters of revenues from fees. The figures are based on a survey of 89 advice firms.

Advisers will be barred from accepting trail commission on business facilitated through platforms from April next year. 

The Fidelity research also found that 17 per cent of firms have already moved all clients they intend to migrate to new fee arrangements, while 56 per cent reported planning to do so before the end of 2016.

FundsNetwork head of advisory services Jon Everill says: “As we edge ever closer to the deadline for the sunset changes it’s extremely encouraging to see that such significant strides have been taken by firms to engage with clients and agree fee arrangements where previously trail commission existed.”

Figures from the firm show a third of firms now have less than half of revenue coming from trail commission, while 57 per cent report less than a quarter.

And just 34 per cent said that more than half of revenue is currently made up of trail commission.