Most IFAs are using multiple platforms - but only a small minority think using just one provider jeopardises their independence, suggests recent research.
A survey conducted by Defaqto in March and April polling 211 IFAs revealed 33% use two platforms, 15% use three and 6% use four platforms. However, 44% used just one platform, whilst 2% do not use them at all.
"Regulators are keen on segmentation of clients and matching products and services for them appropriately," says Defaqto insight analyst for funds Fraser Donaldson. "It seems that advisers are already on the road to achieving this as our study shows that many advisers are using more than one platform."
Donaldson thinks the tendency for multiple platform use could be driven in part by advisers undertaking a process of trial and error as they explore all available options.
"Regardless of the fact they are a service, platforms are still sold or marketed as a product and there would seem to be nothing wrong with trying out different options.
"But I would hope those trialling five or six platforms would whittle the number down to two or three."
He adds on average IFAs use two to three platforms but says the "odd person" can be registered with around 11 different providers.
The research also hints advisers do not think they necessarily have to use multiple platforms to be independent.
"Our survey of IFAs also asked whether advisers think using only one platform might jeopardise an adviser's independent status," adds Donaldson. "Perhaps surprisingly only 23% of respondents said 'yes' whereas 72% said 'no'."
In its March discussion paper, the FSA appeared to lean towards the use of multiple platforms when suggesting customers have different requirements best served by offering a number of providers.
But the regulator has also said advisers can use one platform as long as they can prove it serves all the needs of their customers.
Donaldson says the regulator's stance on multiple platform use is "far from black and white" and the tone of the discussion paper in relation to this area was difficult to gauge.
In its recent platform decision-making guide, AIFA says advisers moving a client on to a platform should demonstrate it is in their best interests.
Avalon director Harry Kerr recently told Professional Adviser the perceived regulatory push to mutli-platform use is creating an interest in more niche platform players as advisers look to segment their businesses.
Research conducted by the Platforum in January dovetails with the move to mutliple platform use. It survey of 52 advisers found 40% use several platforms, including both older supermarkets and new wrap providers. Just 12% said they use only one supermarket and 15% one wrap provider.
Two global vehicles
'Further plug advice gap'
Must appoint separate CEOs and boards
Advisers do come out well
Will report to Mark Till