Standard Life will reduce fees for its Elevate platform clients.
While the new pricing will be available to new clients from April 1, the existing clients will have to wait before the end of the year to benefit from the pricing changes.
The step comes as the providers are facing pressures to decrease their charges.
Last years’ research from Altus Consulting found the average operating cost of a platform was 28bps. The research also found more than half of platforms service their client book for less than 25bps – a 40 per cent increase from 12 months previously.
Last year the consolidator AFH scrapped the fees for its clients.
Elevate pricing for new clients effective from 1st April*:
|Portfolio Value||New charge||Current charge|
*Charges are not guaranteed; they are regularly reviewed and may be changed in the future
Source: Standard Life
Standard Life acquired AXA’s Elevate platform in fall 2016 for £31m. The company’s annual results from that year showed the firm expected £100m acquisition cost. Standard Life UK and Europe chief executive Paul Matthews told Money Marketing at the time the firm expects Elevate to be “profitable in the next couple of years.”
The company said the Elevate is now “profitable and sustainable business” in a press statement from today.
As at 30 June 2018, £56bn of assets was invested across the SLA platforms.
Standard Life’s head of UK propositions David Tiller says: “There is more to come, as we continue to invest in our platforms to support advisers to deliver for their clients today and in the future. I look forward to delivering a Wrap update later in the year.”
Elevate Platform head of proposition Steve Owen says: “The pricing review marks a milestone in Elevate’s journey.
“The efficiencies we have realised, combined with great adviser support, have given us a sustainable platform that can flourish over the long term. It feels right that we can pass on the benefits of this progress, in the form of competitive pricing, to advisers and their clients.”
Platforum senior analyst Andrew Ashwood notes the initial lift in prices following the Elevate acquisition and says the recent price change is welcome:
“All Elevate clients will now be paying less in custody charges than they were before the Standard Life acquisition. The new pricing structure makes the platform instantly more competitive at all portfolio sizes.
“The move to increase platform charges for the majority of clients in the aftermath of joining the Standard Life business didn’t sit well with advisers at the time, but Standard Life has to be commended for bringing those charges back down, and then some, following the necessary developments being completed.”