Skandia: Platforms should not bill fund managers for services

Skandia 480

Skandia head of proposition Graham Bentley says platforms should take account of the services they provide to asset managers when setting their prices, rather than trying to bill investment companies separately.

Last week, Money Marketing revealed Cofunds and Fidelity FundsNetwork are lobbying the FSA to allow some payment between fund managers and platforms to continue after the end of next year for specific work wraps carry out on behalf of fund groups.

The FSA’s latest consultation paper on platforms, published in June, proposed the banning of all payments between fund managers and platforms from the end of December 2013.

Cofunds says platforms carry out client notifications and other roles originally associated with fund managers, for which they deserve to be paid, while Fidelity Worldwide Investment says payments for corporate actions, fund listing, manual processing, charges for dealing errors and marketing activity should be allowed.

But speaking to Money Marketing, Bentley says: “We are not going to be banging a drum to the regulator about this and asking for payments between fund managers and platforms. I can see a strong case for the argument that you price your platform to do the job it is supposed to do.

“When we priced our platform, we went on the assumption that we would not get these extra benefits from fund managers.”

Pilot Financial Planning director Ian Thomas says certain payments for administrative functions that platforms carry out should be chargeable to fund managers.

He says: “We do not want to go back to the bad old days of hidden payments, which can influence the advice process.”