Ensuring direct-to-consumer (D2C) platforms do not stray into advice has become an "obsession" that is ultimately stunting innovation, a report has concluded.
Most providers expect a surge in the number of D2C propositions coming to market over the next ten years, according to a white paper by financial services consultants Altus entitled: ‘Bringing in the harvest: the future of D2C platforms'.
However, it noted many are reportedly holding back over a "continued obsession" with the definition of advice when designing propositions.
Providers eyeing the D2C market have previously voiced their concerns over straying into advice territory.
The regulator is currently conducting a thematic review into the non-advised space, which the industry hopes will result in a clear rulebook.
But Altus said designers' concerns were misplaced in the execution-only space and that financial services companies are lagging behind other sectors which have been more effective in introducing consumer-led propositions.
"The real winners in this world will be providers who look outside of the financial services sector for inspiration," said Altus chief executive Kevin Okell.
"The retail, grocery and telecommunications industries are already managing to harness the art of consumer-centric business modelling very nicely, which is why our industry could learn a thing or two from the way these sectors are operating."
Mark Polson, founder of the lang cat, said direct propositions had already stolen a march on advised models, but that it was now "time for the sector to make its kit a pleasure to use and interact with".
"We've already seen some areas in which the direct platforms space is starting to stretch away from its advised cousin," he said. "In just a few weeks since Hargreaves Lansdown announced its charging structure, we've seen considerable pricing innovation and a real focus on what it is that platforms can do for investors over and above pure custody, dealing and administration."
In a blog for Professional Adviser last week, Polson encouraged advisers to view D2C propositions as part of their "armoury".
Nearly 20 providers were anonymously surveyed for the findings in the Altus report, representing between them more than 90% of the accumulated assets under administration (AUA) in UK platforms.
Appetite has suffered since Brexit vote
'Failure to pay attention can result in enforcement'
200,000 LISAs opened so far
From June 2019
11 years since launch of three Chartered titles