Speaking to InvestorDaily, BT head of platforms Kelly Power said licensees will not be permitted to receive volume-based payments from platform providers under existing arrangements when it comes to new clients starting 1 July 2014.
As a result, there will be a significant amount of change for dealer groups to manage over the coming three months, she said – with all licensees moving to ‘naked’ rate cards (with volume rebates removed).
“That’s a huge impact for us. Over a hundred [dealer group] badges need to be transitioned,” said Ms Power – adding that product disclosure statements will need to be updated as well.
“There’s a big focus on just generally supporting advisers and dealer groups with this transition,” she said.
BT has developed a dealer group ‘advice fee capability’ that will allow licensees to be remunerated for the advice they provide, said Ms Power.
“We’re also launching a portfolio construction fee. A lot of dealer groups provide model portfolio capability and investment expertise to their advisers and clients – and that allows them to charge almost a ‘product’ fee for them,” she said.
BT is also setting up a ‘portfolio management solution’ for dealer groups, which allows them to charge a fee for model portfolios, rebalance them and execute them, said Ms Power.
“A lot of the investment we’ve been focusing on is supporting them with that transition – the licensee advice fee, the portfolio service fee, and the portfolio management solution,” she said.
The full set of licensee fees and services is set to roll out during July and August 2014, said Ms Power.
“The other big focus for us is improved online facilities and efficiency for advisers – better reporting, electronic statements and better integration with planning software,” she said.
“That’s something that we’re getting a lot of feedback from advisers on. [They want us to help them] be more productive and more efficient [when it comes to] compliance work so they can focus on time with the clients,” said Ms Power.
