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Platform price war: Barclays Stockbrokers enters the fray

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Platform price war: Barclays Stockbrokers enters the fray

Barclays Stockbrokers has become the latest execution-only platform to unveil a new unbundled charging structure, following announcements from Hargreaves Lansdown and Fidelity in the last two weeks.

Barclays has matched Fidelity's headline rate, offering a platform administration fee of 0.35% per annum for clients with up to £500,000. Clients with more than £500,000 will pay no further charges above this level.

Barclays said the average fund manager annual management charge (AMC) under the new structure would be 0.68%, down from the current1.32%.

Meanwhile, Barclays Stockbrokers said a new minimum fee of £35 meant that those with less than £4,000 in funds may pay more.

Fidelity unveiled a banded pricing structure last week, which was as follows:

  • £0 to £250,000: 0.35%
  • £250,000 to £1 million: 0.2% (on all investments in all accounts, not just investments over £250,000)
  • More than £1 million: no charge

This compares to Hargreaves’ tiered platform charges of:

  • £0- £250,000: 0.45%
  • £250,000 to £1 million: 0.25%
  • £1 million to £2 million: 0.1%
  • From £2 million above: no charge

Barclays 0.35% matches Fidelity, although the bank undercuts both its rivals by introducing a no fees cap at £500,000 rather than £1 million or £2 million.

Barclays Stockbrokers has also announced it will convert existing fund investments held by clients to clean share classes, where available and where the combined cost of the clean AMC and the fund administration fee is lower than the current bundled share class.

Alastair Thaw, director at Barclays Stockbrokers, said the new pricing structure aimed to be simple and clear for clients.

‘We are introducing what we believe to be a clear, simple and fair RDR [retail distribution review] funds pricing structure. The retail distribution review has encouraged a more competitive marketplace, however we recognise that the changes can be confusing. Investors need clear and simple information about the price they are paying and we have designed our pricing structure with clarity, simplicity and fairness at its heart.’

The platform currently charges £30 plus VAT in administration fees on up to £7,500 in assets held in an ISA, and £50 plus VAT above £7,500. A flat charge £30 plus VAT will apply to all investment ISAs under the new charging structure.

Barclays said it would adjust its online dealing commission structure. From 1 March, it will charge £11.95 for one to nine deals per month, £8.95 for 10 to 19 deals and £5.95 for more than 20 deals. It currently charges £12.95 for one to 14 deals, £9.95 for 15 to 24 deals and 6.95 for more than 25 deals per month.

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