AMP cuts platform fees and attacks competitor pricing practices

AMP has sought to put a stake in the ground on platform pricing, reducing fees on its MyNorth platform while accusing other platform providers of a lack of transparency.

It said it was introducing its new, lower fees to “counter the practice of some industry providers, who are offering advice licensee or advice practice rate cards to encourage financial advisers to use their platform”.

“The use of these rate cards is distorting pricing and equity in super and pension wrap products, as not all financial advisers using the same platform can access the same prices for their clients,” the company said.

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“AMP is calling for an end to the use of advice licensee and advice practice rate cards, so that there is better price transparency for financial advisers and investors, and greater equity.”

The company said that as part of its commitment to delivering a market leading offer for clients and their financial advisers, it had introduced administration fee reductions of up to 22% to its flagship MyNorth wrap offer, which came into effect on 1 May, 2021.

AMP’s North and Summit administration fees will also be reduced effective 1 June and 1 August, 2021, respectively, and will broadly align with the new MyNorth fees.

It said its iAccess and Generations platforms would also be reviewed in the second half of the year. Clients and financial advisers would be provided details of the changes once they are confirmed.

Commenting on the move, AMP Australia chief executive, Scott Hartley said the fee reductions should be seen by clients and financial advisers as a signal of AMP’s intent to compete strongly and transparently across our wealth product range.

“These are highly competitive and transparent fees, which we have introduced as a response to the use of advice licensee or advice practice rate cards by many in the industry, which we see as distorting the system and creating member equity issues in the super and pension wrap products,” Hartley said.

“We are not going to play that opaque game as it creates inequity for financial advisers and their clients and is arguably breaching legal obligations to treat members fairly.

“We are advocating for a more transparent approach to pricing across the industry. All financial advisers should have access to the same platform pricing from their chosen provider and not have to compete with selected advisers getting preferential deals.”




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Comments

Not often I agree with AMP, but they are absolutely right in this case. Preferential platform platform pricing is a form of conflict that must cease.

Sounds like sour grapes to me. AMP have been uncompetitive and out of the market for so long they've been dragged kicking and screaming to the table and have finally acknowledged the competitive pressure. The "up to" 22% reductions shows how much fat was in their pricing (and they have a raft of over-priced legacy products on their books) and with their massive restructuring and fee-for-no-service reparation bill I'm guessing there is a lot more they could do with their pricing but it's easier to bleat about the rest of the industry being more commercial. The rest of the industry still has a long way to go as well because even with preferential pricing, platform providers still make money on what is, at the end of the day, a commodity. The question is scale, both for the manufacturers and for licensees. Without scale, you are a price-taker.

shows you how much AMP advisers were getting a free ride...at least 22% .

You're about 10 years late to the fee reduction party guys, but welcome.

Fees are the only lever AMP can pull. Nobody wants to touch an AMP product. Clients and advisers hate them, and rightfully so. Also what is the issue with preferential pricing? If the outcome is clients get a cheaper product, why is AMP concerned? It is just another example of their own self interest over client outcomes.

Please tell me who would ever use an AMP product again. Firstly they rip the customers off, then they destroy our fellow planners business's and in some case lives.

They will never cross my door way again in any form.

No price reduction is going to make my put my client funds there. It isnt always about the money, its the reputation, consistency, morals and ethics. Who knows how long they will be around, then the clients account gets shafted to another provided and then they hike about the fees. Wouldnt touch them, dont trust them!!!!!!!!

While I agree with AMP here, isn't it hilarious AMP is complaining about a product provider trying to have a group of advisers all use the same product hahah.

Literally what AMP is built on.

AMP and transparency - wow the Pigs must really be flying backwards and in circles over AMP at circular key.
The RC only had one real law to recommend and so many Advice Industry problems disappear.
RC had to kill Vertical Integration of Product and Advisers.
But no they let these AMP fraudsters continue amd just add multiple more layers of BS REGS to try to make Always Conflicted Vertically Owned Advice smell like roses when it stinks like crap.
Let’s hope AMP sell off everything and disappear from the Industry.

This is a perfect example of the fragmentation in this industry. Amp cant make a simple pricing announcement without backstabbing the rest of the industry. When will people realise the way forward isnt to put the knife in others backs.

and you're think it's acceptable that Advisers use a Platform put forward by their licensee, based on the amount of FUM placed. Are clients going to these advisers being placed into a Platform because the Licensee has influenced them. Is that type of smell healthy for the broader industry. What about one Licensee such as Macquarie Bank. that discounts their fees below Industry super funds and then the adviser compares product and can easily state Macquarie is lower, rolls money over on that basis.... but then doubles the advice fees compared to you and pays half back to the Licensee and claims they've done the right thing.

Hi Yogi, im not aware of that practise, sounds dodgy though. I dont support in house products or take rebates I never have. My point is there are many people and companies in this industry that think the only way to get business is point the finger at others. There's plenty of business for everyone, and there would be more if we didn't sling mud at each other. This is a perfect example, amp reduces fees, great, but then proceeds to twist the knife by saying others in the industry are potentially breaking the law or ripping advisers and clients off.

Suddenly AMP woke up and grew some morals. Can't believe I going to say this....WELL DONE AMP.....over to you dirty HUB24 and the scummy advisers using HUB.

What is wrong with using other providers, at least they invest in their platforms and provides another alternative to clients. And well done AMP??? your kidding me aren't you???, what are you congratulating the way they have treated advisers or charge fees to dead clients?

A classic case of "the pot calling the kettle black" I would say! (oh that is racist also in the current pc environment)

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