D2C platform Selftrade axes bank status

Execution-only platform Selftrade has given up its status as a bank after two years, reducing its responsibilities under the Financial Services Compensation Scheme.

The move will take effect from 29 March and means Selftrade will no longer hold deposit-taking permissions and will instead outsource this to other banks.

As a bank, Sefltrade applied its own FSCS limits relating to client cash accounts.

This responsibility will now be rolled into that of the bank Selftrade chooses to hold its client cash.

Selftrade became a bank in November 2011 after being granted deposit-taking permissions by the FSA, heralding the move as its entry into the UK retail banking sector.

In December, the firm’s parent Boursorama wrote down the value of the business by around €42m (£35.1m) because of regulatory demands and delayed IT migration.

Last January, the firm suspended taking on new customers on its platform after voluntarily varying its permissions following discussions with the regulator.

This suspension remains in place.

The firm has also axed its identity monitor which allowed clients to track the availability of personal details online and has also removed its Trader Terminal service which enabled investors to trade 24 hours per day and access market and company research.

Selftrade has in excess of 200,000 accounts and around £4bn assets under administration.

A Selftrade spokeswoman says: “We have now decided to re-focus our efforts and resources on our core activities, which is providing an execution service to our customer. This no longer requires us to hold a banking licence and ceasing to operate as a bank means we can focus our efforts and resources on achieving that aim.”