I read that Standard Life has pulled back from providing a fresh platform for IFAs after a review concluded the traditional provider platform space is ‘very well served’.
Independent financial advisers are served through software that offers them a load of free stuff in return for getting a hefty slice of the products sold advised on, by advisers.
This was the intention of Standard Life’s partnership with SS&C (who they?-ed)
It is understood the intention was never to offer an open architecture platform but a front end that would include some Standard Life products and links to practice management software for advisers.
I am pleased to hear it. IFAs are pampered enough . In my day, the arms race was around percentages of LAUTRO commission offered for my client’s money. Nowadays the commissions are “backdoor” and include “practice management software”. It all amounts to the same thing. Intermediaries are courted by providers and savers pay the price.
I hope that Standard Life and its parent Phoenix use the money saved on its aborted platform to strengthen its workplace pension proposition which is forging ahead as it is but is still lacking in resourcing (or so I’m told) to build or partner to a “pension”.
Workplace pensions aren’t intermediated – they are B2B – the funder sells to employers who market to savers using that most cunning of worksite marketing tools – auto-enrolment.
The workplace channel is not so lucrative as the IFA wealth market , product charges are capped and value for money is measured in terms of member outcomes not the bells and whistles of “adviser platforms”.
Standard Life are also doing very well from its annuity business (which again is direct to the consumer – trustee or saver). This channel is not served by IFAs but by the rather less posh annuity brokers and actuarial consultants who manage individual and bulk buy-outs of pension savings.
‘Following a review of this work, we have concluded we should focus on the areas where we have the greatest momentum and capability,’ the spokesperson said.
Presumably Standard Life and Phoenix have worked out that as life insurance companies, they are well placed to insure risks such as people living too long or dying too soon. I have always thought that these risks were underserved and delight in hearing that I am not alone!
My few remaining IFA friends will , I am sure, agree with me, they are not the least loved of the financial services community. There is an award ceremony a week for them to attend, a host of events designed to increase their CPD (and waste lines). They are venerated as financial gurus by all who serve them.
So I’m sure they’ll get over losing the prospect of a Standard Life/SS&C platform. Meanwhile , my admiration for Standard Life has gone up another notch.
No – I don’t understand it either – but it looks good!
There are five criteria that must be met in order for a market to be considered “perfectly competitive”, Henry.
1. All firms sell an identical product.
2. All firms are price-takers.
3. All firms have a relatively small market share.
4. Buyers know the nature of the product being sold and the prices charged by each firm.
5. The industry is characterised by freedom of entry and exit.
At firm level, perfect competition describes an imaginary market condition where all consumers have access to the same products and information.
In this type of economy, all firms must offer the lowest price possible or risk being undercut by their competitors.
In a perfectly competitive market, firms can only experience profits or losses in the short run.
In the long run, profits and losses are eliminated because an infinite number of firms are producing infinitely divisible, homogeneous products.