Advisers will develop their own ‘virtual' platforms to avoid losing margins along the distribution chain to life companies and other parties, Prudential UK's Barry O'Dwyer has predicted.
The firm's deputy chief executive was speaking at Marketforce's Impact of RDR conference this morning, where he speculated on the development of the industry over the coming years.
Prudential has been one of the few major life companies not to develop a platform and O'Dwyer explained why he thought they were an unnecessary tool for advisers, considering the existence of sophisticated back office solutions.
"The reality is that because all the providers have built relatively decent electronic links, a virtual platform is all that's needed. As long as the links are seamless, why would you build an extra piece of kit?" he asked.
"Our focus has been to have an open architecture which makes it easier for an adviser to deal with us. My view is that they will build their own solution once the technology becomes cheap enough."
Talking about the squeeze on the distribution chain post-RDR, he also pointed out that platforms continued to be a way for other parties to add more costs.
"There is no reason for a platform to be provided by a life company. In fact it's odd when you think about it and it's much more sensible that a platform is provided by a network of IFAs," he added.
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