A major new report from NextWealth into white label platforms reveals that almost half of adviser firms with GBP250 million AUM plan to launch their own white-label platform in the next three years, while 8 per cent are already underway.
Heather Hopkins, MD of NextWealth, says: “Our survey with advisers for the report reveals a shift could be on the horizon in the way that financial advisers structure their businesses. The key drivers for change are a desire to boost operational efficiencies, improve the client experience, exert more control over price and capture margin. Technology is driving the trend for white-labelled platforms and, with consolidation and private equity investment in financial advice firms on the rise, we are seeing the emergence of advice businesses with the scale – and the appetite – to launch their own platforms.
“Third party platforms need to adapt – and fast – to stem the flow of assets. Most of the drivers toward white-labelling can be addressed on a third-party platform but more needs to be done to support large firms, in particular to efficiently manage the investment proposition and to extract data for reporting and MI.”
Compliance has a major role to play for advisers considering setting up a platform. Russell Facer, CEO of Threesixty Services welcomes the NextWealth report.
He says: “The platform market is changing rapidly and the report provides welcome context and insight into white labelled propositions. It’s crucial firms considering entering the platform market — either as a platform service provider or using a white label proposition — understand what they are getting into and how these arrangements are structured. At the heart of these commercial arrangements lie the investors. The recommendation of a platform solution must be suitable and in clients’ best interests.”
To help advisers who are considering transitioning, Threesixty has recently published a platform guide, to remind firms of their regulatory obligations when operating in the platform market.
The NextWealth White Label Platform Report is part of the firm’s Tech Stack Report series. It is free to download from the NextWealth website.
