Platform services for brokers is a growing area in the United States but a relatively untapped market in the Australian industry, according to Powerwrap chief executive Cormac Heffernan.
Mr Heffernan was speaking following Wednesday's announcement that platform provider Powerwrap is acquiring financial services and broking firm MWH Capital.
"It's interesting because this is one of the fastest growing areas in the US at the moment where brokers basically set themselves up and they can get all of the services from a service provider," Mr Heffernan told InvestorDaily.
"Brokers really haven't been great users of platforms in the past, mainly because platforms were set up as managed funds-type platforms."
Powerwrap, he said, sees "a big opportunity" with the broking market.
As a result of the recent acquisition, Powerwrap will provide platform solutions within the growing personal investment and broker segments of the market.
"With the acquisition of MWH it gives us the execution capability and we'll be able to basically provide for a broker all of the services that they will require," he said.
The joint venture with MWH will allow brokers, advisers and their clients to access a customisable, end-to-end solution, Mr Heffernan added.
"I think that platforms are widely misunderstood in the broking space whereas actually they are very flexible," he said.
"We're planning on being quite innovative with our platform over the next 12 months. There are going to be a few more interesting things as the year goes on, particularly around the trading space.
"We'll be taking advantage of this acquisition by being able to pass on better trading to our clients. But this is very much a first step."
