Just like going to Tesco or Sainsbury, IFAs will soon be able to shop
around when selecting a fund supermarket.
Fidelity has been joined by a new outfit, Consolidated Funds, financed by
four other fund management players. By November, when the new operation
launches, IFAs will no longer face a Hobson's choice between direct player
Egg, which cuts IFAs out of the picture, and Fidelity.
Gartmore, Jupiter, M&G and Threadneedle have joined forces to create their
own project primarily because they are reluctant to join Fidelity. The
refusniks believe that signing up would hand too much power and information
to the “Big F”.
For IFAs, there is less of a threat. Both Fidelity and the new operation
allows themto white-label the supermarket as their own and both allow IFAs
to be paid commission. IFAs worried about Fidelity's size and clout should
remember that, both here and in the US, Fidelity remains committed to
advice, even if, like most providers, it is not above accepting direct
business too.
But the initiative from Gartmore et al has to be good news. IFAs can now
expect the electronic equivalent of loyalty schemes and loss leaders
although highest on their wish list is probably a service that works
quickly with no bugs or admin blunders. The struggle will be intriguing as
both players and perhaps several more search for the formula that will make
them the Tesco of fund supermarkets and not Sainsbury, let alone Marks &
Spencer.
No matter who is the eventual winner, advisers should be grateful to both
operations for pointing the way for them to get a share of business in the
new e-commerce world.
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