Prudential to increase its presence on the internet By Jane Wallace Prudential is to launch a unit t...
Prudential to increase its presence on the internet
By Jane Wallace
Prudential is to launch a unit trust supermarket over the internet this October.
It intends to use egg as the basis for the service which should allow customers to buy and sell funds without using hard-copy signatures.
Egg account holders will be able to transfer money online to and from their accounts directly to the fund group or groups of their choice without filling in the usual forms. In addition they will be able to get real-time statements on the value of their holdings.
As egg clients have already used signatures in setting up their accounts these can now operate like a stockbroker nominee account - with either verbal or internet-based instructions being enough to effect a buy or sell.
Prudential is approaching major investment management groups to provide links to the service. Fund managers will pay Prudential a distribution fee for participation in the service. The benefit to fund groups is access to egg's 550,000 deposit account holders.
Currently, the only way to access different fund groups simultaneously is through a fund of funds, an insurance policy or other multi-manager contract such as those operated by Skandia. This would involve paying fees both to the provider and the underlying fund managers. With the egg product, fees would be the same as if approaching the manager direct.
What part IFAs can play in the new product, and whether commission will be available, is as yet unclear. It is possible that IFAs could use the product themselves to help speed up administration.
The Prudential's move to increase its presence in internet distribution comes as its recent acquisition, M&G, prepares to offer commission on Isa sales that are routed to the group through an IFA's website.
M&G has offered fully online Isas since 6 April and is now extending the service to allow intermediaries to offer it to their clients, while still retaining commission.
IFAs can add a link to the M&G website page that contains the application form. When the page is accessed, M&G's system will pre-fill the application form with the IFA's details and the client can then complete the form online, and invest electronically using Switch.
This is taking place as Prudential prepares to confirm that M&G will be the group's lead retail investment brand. It coincides with the arrival of Gary Shaughnessy as marketing director. He previously held the same role at AXA and before that at AA Financial Services.
The Prudential's success in building a unit trust trading platform contrasts with that of the unit trust industry's EmxCo. Autif, which has spearheaded the project, has refused to comment on whether or not sufficient funding has been obtained to go ahead with the project.
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