It is understandable that the vast majority of attention on CP80 has been focused on the widening of the current tied environment to allow product providers to sell adopted products as well as their own.
At the same time, however, even greater changes have been made in the area of direct-offer products. This will make it far easier for providers to set up their own supermarket operations offering a wide range of products off the (browser) page.
Only a couple of years ago most people found the concept of a financial supermarket in the UK hard to believe. Now they are here to stay and the relaxation of regulations covering them is likely to lead to even more launching in the near future.
But before advisers start worrying about the prospect of even more competition, the good news is that there is strong evidence from the US that the emergence of financial supermarkets has caused more Americans than ever to take financial advice.
This was one of the key messages being put forward at the first roadshow to launch CoFunds, the fund supermarket backed by Gartmore, Jupiter, M&G and Threadneedle. Actually, calling it as a launch was possibly taking things a bit far. In practice the event was more a “coming soon” announcement. I have to take my hat off to the organisation for presenting things you would have reasonably expected of a fund supermarket but that they had not actually done yet as a positive rather than a negative.
For example, the fact that they cannot yet conduct business online was because they thought the majority of Isa business in the current season would be run on paper!
Equally, the fact that their Pep transfer service will not be available until after the end of the tax year was so they could concentrate on this year's Isa season.
Although the presentation was highly professional, to my mind there was a distinct lack of actual content. Indeed, chief executive, Sam Jensen did have to admit that at the time of the seminar the company had yet to receive the necessary authorisation from either IMRO or the Inland Revenue.
However, at the time of writing – a week later – I am told by CoFunds that both approvals have now definitely been granted.
At the launch the company also announced their link-up with Morning Star, a global player in the provision of managed fund information, although not one that is as well known in the UK as they are in other parts of the world.
Again this was really a “coming soon” rather than a launch, as apparently Morning Star's own UK site is not expected to see the light of day before mid-March at the earliest and their tools will appear on the CoFunds site “shortly” after.
Even though they are coming later to the market than some of the competition, I must say I was very unimpressed by the description of the Morning Star tools that CoFunds will be offering.
Although there will be the ability to examine asset allocation of an existing portfolio, there is nothing along the lines of Skandia's USelect product to assist in matching client attitude to risk to a suitable new portfolio. If one looks at leading US supermarket sites, such facilities are increasingly becoming standard – their absence here is conspicuous.
Where CoFunds does appear to have a clear market advantage is their proposed Pep transfer service. They say they will be able to accept existing investments from funds on their service, referred to by Jensen as “same species” transfers as a simple re-registration of assets, so there will be no charges to the customer.
When CoFunds launch the remainder of the technology services they are claiming this could prove very attractive as transfers into Skandia's Multi Fund Shop and Fidelity's Funds Network currently incur charges in this situation.
What disappoints me more about the CoFunds launch is the lack of online facilities to assist IFAs in capitalising on the internet as part of their own 2000/01 Isa campaign.
By comparison, I recently attended one of the joint briefings being run by Fidelity and The Exchange for the latter's integration of the Funds Network service. This allows advisers to integrate the Funds Network service into their own web site or, if they do not have one, a new site using the Exchange's adviser web builder service.
According to The Exchange, facilities can be set up in just a few minutes for any existing eXweb user, which must sound attractive for any adviser wanting to run a last minute online Isa campaign. At the workshop I attended, a number of IFAs were clearly attracted by the opportunity of mass mailing their clients with details of the Fund Network service and then inviting them to visit the adviser's own web site to buy their Isa, with, of course, commission being credited to the IFA.
Not to be outdone, Skandia has also announced in the last week that it has become the first fund supermarket to be available over multiple IFA portals. Multi Fund Shop is now accessible via Bankhall's IFA Engine service, in addition to the established deal with AssureSoft. It also tells me it expects to add the service into their own IFA Extranet service by mid-February in time for this year's IFA. All these links are however, purely business-to-business. Advisers will have to wait a little longer before they can embed this service in their own web sites.
Different fund supermarkets have chosen different priorities. CoFunds have opted for the paper-based route first, and while I hear their argument I am not entirely convinced by it.
Skandia, on the other hand, has concentrated on launching multiple B2B presences. This leaves Fidelity, at least for the time being, as the only major fund supermarket that can help IFAs pull in additional business from their clients via their own web sites for this Isa season.
While it is slightly disappointing not to have a wider range of business-to-consumer enabled options for 2000/01 Isas, clearly the Fidelity service would appear to be the best option for those who want to go this route.
To be fair, it could be argue
d that this year is really only a dress rehearsal for next year, by which time it would be fair to expect that major volumes of business will be attracted in this way.
Certainly any fund supermarket which has not provide full business-to-consumer support for advisers by the end of this year will be seriously undermining its own credibility in the marketplace.