Selecting the right platform is a bit like building a house: if the foundations aren’t stable then you’re in serious trouble further down the line.
I’m increasingly seeing advisers considering switching platforms looking to financial stability as that key foundation stone from which to build.
Today’s advice platform market is characterised by oversupply and frequent regulatory change, leaving a key problem for advisers to overcome – long-term stability.
A financially robust platform reassures advisers their chosen provider will endure market consolidation, invest in continuous innovation and maintain high service levels, while being able to adequately adapt to the pace of regulatory change.
Financial stability is about more than survival; it’s about thriving in a competitive market
Consumer Duty further underscores the need to take a more long-term approach. Advisers must ensure their platform partners can consistently meet these regulatory expectations, safeguarding consistency in service quality and good client outcomes.
Financial stability is about more than survival; it’s about thriving in a competitive market.
A stable platform is not a static platform. Instead, it’s a reliable partner that adapts, supports advisers’ evolving needs and provides the infrastructure to keep pace with technological advancements.
Without assessing a platform’s financial stability and ability to invest in development, advisers risk partnering with a platform that could struggle to sustain service quality or keep up with industry innovations, potentially putting their client relationships and business growth at risk.
Contrary to some opinions, advisers are open to exploring new platforms, but they generally need a trigger to make such a significant switch
Contrary to some opinions, advisers are open to exploring new platforms, but they generally need a trigger to make such a significant switch.
Realistically, a firm will only shift large volumes of business when there’s a compelling reason — which are often realised by concerns about their current platform’s financial health and levels of investment.
Consistency of service, back-office connectivity, and digital automation and experience give advisers an edge in an industry where marginal gains can make a real difference.
If doubts arise about a platform’s financial security, advisers should question whether they will continue to see these cornerstones of platform efficiency maintained.
Switching usually requires significant push factors that prompt advisers to consider their options. These can include long call wait times, processing delays, transaction errors and lack of accountability, all problems that damage client relationships and erode trust.
Platform charges have increasingly become a secondary consideration
Platform charges have increasingly become a secondary consideration. Charges across the industry are highly competitive, and advisers now view them as relatively uniform. Instead of focusing solely on costs, advisers weigh charges against a broader range of factors, like digital experience, investment choice, service model and overall value for money.
Platform charges represent only a small portion of the total cost of advice, which includes adviser fees and investment management costs. So, with cost differences between platforms generally minimal and one eye on Consumer Duty, advisers are beginning to prioritise the long-term viability of a platform over short-term savings.
With a focus on value mandated by Consumer Duty, advisers are gravitating towards platforms that have greater resources at their disposal. These are more capable of investing in reliable service and support, which ultimately benefits clients and helps advisers to scale their businesses.
Why onboarding matters
A seamless onboarding experience is essential for affirming advisers’ confidence in their decision to switch platforms. This process is their first impression of the new platform and sets the tone for their platform experience.
A well-designed onboarding process should be efficient, transparent and supportive, according to the individual needs of advice firms. This process involves not just the technical aspects of transferring data and setting up accounts but also clear communication, training and ongoing support.
Delivering all this requires investment, not just at the start, but as part of a continuous review process.
Effective onboarding can transform what is seen as a daunting process into a smooth, positive experience
By minimising the friction involved in switching and providing comprehensive assistance during the transition, platforms can reduce perceived barriers to change.
This proactive approach instils a sense of trust and reliability, which fosters long-term loyalty, making advisers more likely to stay with the platform and recommend it to others. Effective onboarding can transform what is seen as a daunting process into a smooth, positive experience.
While multiple factors influence platform selection and switching, we are seeing the emergence of financial stability as a critical element.
In an era of market oversupply and rapid technological change, advisers are increasingly recognising and seeking out platforms that are operationally efficient and financially secure.
Understanding these dynamics allows platforms to better position themselves to meet the evolving needs of advice firms and their clients to deliver mutual future success.
Ranila Ravi-Burslem is intermediary distribution director at Scottish Widows
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