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Forum wants fund firms to follow electronic trail

The Adviser Forum is turning its sights on fund managers with a project aimed at motivating fund firms to transact more electronic business with IFAs to save time and cost.

The forum, which has had significant success in targeting the life and pension industry, is urging IFAs and fund managers to set up systems enabling electronic payment of trail commission.

The forum represents about 75 per cent of companies comprising the IFA market. This is its first foray into the fund management sector and it hopes to make inroads quickly. The first meeting was held last week in London with a number of big IFAs and fund managers to establish the agenda.

It says the time it takes to process trail payments, which tend to be large numbers of small payments, means it is often more costly than the commission is worth.

With the backing of fund supermarkets Cofunds, Funds Network and Selestia and Fidelity, Invesco Perpetual, JPMF and Jupiter, the Forum is hoping to prove to the industry it could save nearly £9m a year in improved processing.

The forum has released data which shows that life and pension providers could cut their incoming phone calls by up to 40 per cent by the end of 2005. The percentage of calls requesting policy valuations varies between providers but the forum says every insurer could save considerable time if they moved to electronic messaging.

Chairman Ian McKenna says: “The support for this project in the fund management market is tremendously encouraging. There seems to be universal acceptance that this is an area where it is possible to deliver real economies for both advisers and managers.”


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