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FundsNetwork plans multi-million pound platform revamp
by Jun Merrett on Aug 27, 2013 at 10:48
Having guided FundsNetwork through the regulatory minefield of the retail distribution review (RDR) and platform paper, Pat Shea is preparing to splash out millions of pounds revamping the business in an effort to ensure it thrives in an increasingly competitive market.
Shea (pictured), an American who has been with Fidelity since the 1980s, took on the top job at FundsNetwork just over a month before the RDR came into force.
The following three months were consumed with preparing for the platform paper. Although most of the work, such as launching an unbundled charging structure and moving away from a reliance on fund manager rebates, had already been done, there were still some surprises in store for Fidelity, notably the ban on fund groups cross-subsiding their platforms.
Like all of the fund supermarkets, FundsNetwork had work to do to adapt to the direction of travel first set out by the Financial Services Authority in 2010. However, Shea said the work was far from over because he had recently been given the go-ahead to implement a three-year revamp of the platform.
‘We, alongside many other [platforms], have been consumed by the regulatory agenda for the past few years. I was appointed to do an evaluation of FundsNetwork, and my multiyear multimillion investment has been approved,’ he said.
‘It’s safe to say over the next three years we’ll be investing more into FundsNetwork than we ever have in the past. It is three years of major development: in its proposition, service, usability and client experience.’
Pension offering overhaul
Evidence of this investment and Shea’s honest evaluation of FundsNetwork’s failings can be seen in its recently announced plans to overhaul its pension offering.
The platform is working with technology provider GBST on the launch of a new Sipp offering and will review the position of its current Sipp wrapper from Standard Life which has been the sole provider since 2009.
Shea said Fidelity’s pension proposition needed to evolve. ‘We’re moving from just having funds on the platform, but when you look at the market, something like 30% of it is in bonds or pensions. I didn’t feel like Fidelity had a competitive and compelling offer in that space. That’s why we’re introducing the pension next month,’ he said.
‘It’s a critically important part of the market. We had a third-party solution, but it wasn’t competitively priced or integrated.’
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