A host of online tools looking at with-profits investments, asset allocation, yield incomes, e-commerce, regulation and UK savings are being developed by Selestia over the coming months, says Owain Kember, IFA marketing manager.
Talks with back office systems providers are ongoing, but the company is not yet ready to provide details, Kember adds.
While the wrap proposition continues to develop – Selestia prefers to think of itself as a business solutions provider rather than operate under the single moniker of wrap provider – questions do remain about just how fast the industry will adopt wraps, Kember admits.
This is not least because advisers may be trying to figure out what wraps actually mean, while also waiting for some wrap platform providers to follow up on previously announced services.
Selestia meanwhile is looking to key themes to drive its proposition and build on the roughly 560 funds from 51 managers available through its service, Kember says.
With some £330bn tied up in with-profits, there is a huge opportunity to provide the “solutions” advisers may be looking for to help their clients either get out of with-profits investments completely or minimise exposure to this sector in light of recent years’ changes, suggests Kember.
Putting aside the semantic debate over the use of words such as “with-profits” or “MVA” or “MVR” and what the average person on the Clapham Omnibus actually understands by way of such expressions, it is clear there has been a market shift away from with-profits.
Data from the ABI, for example, shows total of new single premiums for with-profits bonds in the first quarter this year was £450m, against £901m in the same period last year, and £3,552m in the first three months of 2002.
Regulatory activity is also having an impact, with, for example, the FSA pushing PPFM (Principles and Practices in Financial Management) as it attempts to bring improved transparency to the sector.
Selestia is looking to develop a “campaign” on with-profits and seminars for IFAs, which ties in with efforts to develop further its own ecommerce offering.
Focus is on ensuring IFAs can deal effectively with issues of transparency, communications and information provided to clients who want to shift their money elsewhere.
However, importance of the campaign lies in offering a “credible strategy for removing clients from with profits,” Kember says.
Linked to this is development of a tool to further refine risk profiling of clients, to highlight mismatches between current levels of risk associated with underlying investments and what client’s actual risk profiles may be.
A yield tool is also set for launch later this year which will calculate of income across portfolios.
In terms of the bigger picture, Kember believes wrap technology and industry solutions will be driven by the need to save.
It is still possible that people in the UK will be forced to save for retirement - although that is yet to be decided by committee – something that would definitely push demand for more technology and ecommerce.
In the meantime a combination of messages highlighting the need to save coupled with ongoing regulatory changes, that is, depolarisation, should provide the impetus for greater levels of ecommerce.
And as technology and solutions are pushed so to will wraps, Kember adds.IFAonline
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