“There’s no such thing as a free lunch”, a panel of experts has told Money Management and Super Review’s Future of Wealth Management conference, and platform prices won’t hit zero.
Arnie Selvarajah, CEO of Bell Direct, told the conference that platforms initially thought to be free, were subsequently found to not be, and while prices will never hit zero, advisers needed to simplify fees for clients.
“I think there’s an opportunity for us to get a substantially higher number of clients to engage in our industry if we make it simple for them,” he said.
In terms of how advisers can make pricing simple, the panellists all agreed that transparency was key, and Selvarajah said while RG97 went a little way towards it, each adviser interpreted the regulations differently.
“And everyone comes up with a different result,” he said. “If we don’t do it [make prices transparent], the regulator will, so in my mind, it’s better for us to be proactive on this.”
Anantha Ayer, country head of Avaloq, said specifically mentioning what the platform prices include in terms of transactions and switching fees was necessary.
From a global perspective, Ayer said there was more regulatory driven transparency, and advisers needed to prove why they charged for what service they provided, and suggested Australia should head that way.
Indy Singh, managing director of Fiducian Group, agreed more transparency was needed, but highlighted that the industry is a business, and advisers should disclose what they want and leave it to the client to decide.
“Maybe it needs to be in bigger print, but if you can sell it better … that’s what makes it a market,” he said. “It’s an open market, and I don’t think there’s an easy solution.”
Singh said clients rarely looked for the fine print, and if advisers could provide the client with service and value, it was the client’s choice.