Standard Life is set to unbundle its core retail product range as part of changes it is making in line with the RDR.
The provider is to announce explicit charging structures in the summer for its active money Sipp, retail portfolio bond and for funds available through the FundZone platform.
Where the FundZone platform is used, fund manager rebates will be paid back to the client via their cash account, as is currently the case with the Standard Life wrap. Standard will then introduce an explicit wrapper charge to cover its cost.
Standard Life says it is not making any changes to its wrap charging structure until the FSA clarifies its position on payments between fund managers and platforms and cash rebates.
Last August the FSA it wanted to ban both fund manager payments and cash rebates, but needed to carry out further research on the implications of a ban. The industry is still awaiting the outcome of that research.
Standard Life has also set out its RDR adviser charging structure. On the wrap, Standard Life will facilitate adviser charging from both the wrap cash account and the Sipp cash account.
The wrap will facilitate initial adviser charging as either a percentage of investment or flat fee, ongoing adviser charging as either a fee or percentage of assets under management, or on an ad-hoc basis as a flat fee. A regular initial fee can also be taken on Sipp investments on the wrap.
Standard Life has clarified that on its retail portfolio bond, any adviser charging deductions will form part of the 5 per cent withdrawals. On annuities, the adviser charge will be not be taken from the tax-free cash.
Advisers can choose to be paid monthly, quarterly, half-yearly or yearly.
Standard Life says advisers will be able to start writing business on an adviser charging basis from early Q4. The provider will be writing to clients to advise them of product and contractual changes between July and October. Advisers will be given advance notice before the letters go out, and will also receive copies of the letters.
Standard Life UK retail and RDR director Graeme Bold says: “We believe there will be a strong advice market post-RDR. We are publishing this information because we want to support advisers make the transition, with enough detail available for them to be able to plan their proposition effectively.”