Regulations pause platform enhancements
The spate of regulatory changes in the financial services sector has halted product enhancements of platforms and stagnated projects, according to Eureka Whittaker Macnaught.
The financial planning firm's chief financial officer, Andrew Jones, said many projects that were in the pipeline got delayed due to the legislative changes.
The Future of Financial Advice reforms, opt-in, changes to conflicted remuneration, grandfathering principles, and other reporting requirements had drained capital budgets away from product enhancements from a client perspective.
"When you're flicking accounts from one grandfathered account to a non-grandfathered account, what should platforms be passing on?" he said.
"Every time there is what appears to be a modest legislative change that's agreed upon, it has a multiplier effect in terms of systems and changes. What sounds logical in theory has massive real life practice and systems implications."
Jones, who sits on the Colonial First State FirstWrap adviser council, said he had seen first-hand the delays that had occurred in platform projects due to regulatory changes.
This includes enhancements like platforms expanding their model portfolio or managed account functionalities, offering annuities, introducing more dynamic reporting systems, providing clients and the end-user similar functionality offered to planners, or subtle changes like inserting subtitles in reports.
"It's just all sorts of permutations. You've got to go through and do your prioritisation: what have you got to do, and when? And what's the next roll of projects?" Jones said.
AUTHOR
Malavika Santhebennur
Recommended for you
As advisers risk losing two-thirds of FUA during the $3.5 trillion wealth transfer, two co-founders underscore why fostering trust with the next generation is vital to retaining intergenerational wealth.
As advisers seek greater insights into FSCP determinations, what are the various options considered by the panel and can a decision be appealed?
Amid the current financial adviser shortage, advice firm Link Wealth is looking to expand its financial literacy program for high school students across the country.
TAL Risk Academy has updated its range of ethics courses to help financial advisers meet their CPD requirements following adviser feedback, including interpreting FSCP determinations.
