Online investment and share dealing platform Selftrade has introduced a platform fee as part of its new pricing structure introduced following the Sunset clause.
The platform charge will see the first £50,000 invested charged at 0.30 per cent, the next £200,000 at 0.25 per cent, while anything over £250,000 will be charged at 0.15 per cent.
Equiniti, which acquired Selftrade in 2014, said the introduction of the charge was due to the abolishment of trail commission following RDR. This fee was banned effective 1 January 2013 to align the interests of intermediaries with their customers.
The new platform fees do not apply to Child Trust Funds accounts.
“Following the changes prompted by the Retail Distribution Review and the move to cheaper ‘clean fund’ classes consistent with the unbundling of fees paid by customers we are introducing a fund platform fee, in place of the trail commission previously paid by the fund manager. We will maintain our discounted dealing rates for ETF for those who want the benefits of accessing ETFs as an attractive alternative to funds,” says Richard Donegan, director of Selftrade.
Selftrade has made further fee changes, which come into effect from 9 May, include reducing the standard online dealing fee to £11.75 from £12.50 per trade. The platform has also reduced the fee for ETF trades to £9.99 from £12.50, while a flat telephone rate of £17.50 will now apply. Previously the telephone fee rose to £40 for trades over £2,500.
Donegan says it has upheld its promise to customers that it would not make changes to prices for one year following its acquisition.
“Being part of the larger Equiniti Group means that we can use our scale and resource to introduce efficiency savings, which in turn we can pass on to our customers,” Donegan says.
“As a result everyone on the platform will benefit from a reduction in the headline dealing rate and more customers will be able to receive the discounted rate for frequent traders as we lower the threshold.”
The threshold for customers to be eligible for a reduced £6 frequent trader rate will also drop from 100 trades a quarter to 20 times per month.
For shares dealt in an overseas market in local currency up to 0.5 per cent will be added as a spread to the rate used by the market-maker to convert the currency into sterling. A further 0.5 per cent will be added as a currency charge.
From October 2016, Selftrade’s inactivity fee will increase to £10 plus VAT per quarter from £8.75 plus VAT.