The majority of financial advisers have had to apologise to clients due to poor service from investment platforms, with asset transfers identified as a major issue.
This statistic forms part of Parmenion’s 2024 report, The Impact of Poor Platform Service, produced in partnership with the lang cat.
The study, which highlights deteriorating platform service levels, found that 95% of advisers apologised to clients on behalf of providers in the past year, an increase from 2023.
Based on research conducted in autumn 2024 with 172 advisers, it revealed that nearly 30% experienced a “significant impact” on their day-to-day work from poor platform service.
One respondent described the service as “unbearable”, citing long delays, lost records and inadequate company knowledge. The lang cat called the proportion of advisers forced to apologise “astonishing”.
Frustration with platform service has driven many advisers to switch providers, with 45% reporting they changed platforms in 2024 due to poor service.
“We can see from the stats that advisers are voting with their feet in a way they didn’t before,” said lang cat chief executive Mark Polson at the launch of the report today (November 28).
“I’d like to think we can sort it out as an industry,” he added, although he acknowledged that new regulation might be necessary to address the problem.
“Ultimately, you can’t take something that’s on its knees and fix it within 12 months,” Polson concluded. “But at the end of the day, we’ve got actual clients losing actual money because people aren’t doing their jobs properly.”
Platform transfers were singled out as especially problematic in the report, with 90% of advisers associating the process with negative experiences.
Descriptions included “time-consuming”, “painful” and “onerous”.
Over 20% of advisers reported transfer delays exceeding six months, and nearly 10% waited more than a year.
“Our industry is obsessed with measuring things, but measuring things hasn’t fixed anything yet,” said Parmenion CEO Martin Jennings at the report launch.
Other key statistics include:
- 82% of advisers feel poor platform service significantly disrupts their daily work.
- 89% agree providers should publish standardised transfer data.
- 75% of firms favour cash transfers for their predictability and speed.
- 34% of platform interactions involve chasing queued work.
Commenting on the overall findings, Jennings added: “In the new era of Consumer Duty, this year’s report is a disappointing read. The advisers surveyed have even less confidence in platforms in 2024 than they did last year, which should be concerning to providers.
“Poor platform service is linked to a double-digit loss of productivity in advice firms, and we would appeal to the whole industry to ‘lean in’ and take accountability to improve the platform experience for everyone, especially when it comes to pain points such as transfers.”
Parmenion chief Marketing officer, Sarah Lyons, said: “We hope our new report will galvanise everyone with a stake in platform performance to take action to improve overall service.
“The client pays for the platform, but it’s the adviser who bears the cost of poor service. This unseen cost continues to blight the profession, and ultimately undermines consumer trust in all of us.”
The lang cat’s insight director, Steve Nelson, added: “One year on from the inaugural ‘Impact of Poor Service’ report, we have seen things get worse for adviser firms and their clients.
“Platforms must embrace technology and improve their processes to better serve advisers and their clients, or as we’ve seen in 2024, advisers will punish them by selecting a better alternative.”
I imagine that as many are apologising to clients for the mire of unreasonable and excessive regulation that’s making it almost impossible to provide the service/s that clients need and want rather than what the FCA thinks they must have, regardless of whether or not they actually do.