Platforms are considering selling management information to asset managers in the wake of the Financial Conduct Authority’s increased scrutiny of providers’ suitability controls.
The regulator is set to kick off a thematic review into asset managers in the summer as it looks to ensure firms have properly assessed client suitability.
The FCA’s platform policy statement, published in April, opened the door to platforms charging fund managers for certain activities, including the provision of data.
It added it is “important for platforms to be able to feed back good-quality management information to a product provider”.
Axa Elevate is in the process of trialling the provision of data to fund groups and will decide what the service will cost if the trial is successful.
Axa Elevate chief operating officer Andrew Smith says: “We are testing this with asset managers over the next few weeks to determine what would add most value, how they would like this information delivered to them and at what cost.”
Standard Life head of investment group relationships Graham Dow says: “We think aspects of this data have a value and are considering passing this on to fund managers at a cost.”
Transact, Nucleus and Ascentric say they are considering whether to charge for the MI data.
Nucleus says although it is looking at the options available, it would have preferred the FCA to have banned all fund manager payments to platforms.
Chief executive David Ferguson says: “Frankly, we would have preferred the FCA to have said fund managers cannot pay platforms for anything, but we will not operate at a commercial disadvantage.”
Graham Bentley Investment Intelligence managing director Graham Bentley says: “Customer MI could become a lucrative source of revenue for platforms, or as an added-value service justifying bigger fund price discounts.”