According to Deloitte, increased competition and reduced margins will force investment platforms to consolidate.
Andrew Power, lead Retail Distribution Review partner at Deloitte, said: “The value of assets held on platforms is estimated to grow from about £200 billion today to £600 billion by 2018. This growth will be driven by continued demand from advisers who see platforms as an essential part of their RDR-compliant, fee-based business models. However, one consequence of the RDR is that margins will be squeezed with revenues for platforms likely to fall from about 30bps to 20bps. For a platform provider, this could increase the breakeven point from around £20 billion of assets to about £40 billion. The result will be that the intermediary platform market will consolidate to fewer than 10 large providers and a few specialists compared to about 30 platforms today.”
Press release
© Deloitte LLP
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