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Wrap is scrapped

Industry specialists say Friends Provident is right to abandon its wrap if it needs to cut costs.

Friends is ditching its wrap plans as part of a move away from wealth management.

CWC Research managing director Clive Waller says it would have needed similar market share to FundsNetwork, Cofunds and Skandia/Selestia to make wrap a success. He says: “There are three big players and Standard Life is quickly becoming the fourth with 40 per cent of IFAs already using it. It would have cost a fortune for Friends to compete.”

Standard Life Savings head of communications Mark Polson says: “Wrap is hard to do, it takes a long time and costs a lot of money. You need to be committed in capital and manpower. This should be a lesson to others that wrap is not something to dip your toe into. There are plenty of really good players in the market and there is room for more as long as they are going to do it seriously.”

Friends wrap was to be launched this summer and it was halfway through development.

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