Former James Hay chief information officer (CIO) Iain Tait has joined technology provider Delta Financial Systems in a push to launch the latest version of its platform designed to support post-pension freedom products.
As Delta CIO, Tait will be responsible for the accelerated roll-out of the latest version of the firm's Platinum-Pro platform hosting its existing self-invested personal pension (SIPP) and small self-administered scheme (SASS) applications.
The platform, Platinum-Pro, has hosted the SASS-Pro application since December 2015 but rolled out the fully functional version of SIPP-Pro in January 2017.
The firm plans to develop additional applications for the platform throughout 2017 and 2018 to meet market and client needs in the pension freedoms and lifetime savings space. One application under consideration is iFreedom, which is intended to provide self-servicing for its client providers as well as its end users, with the option for providers to trigger adviser input before the user draws down.
The SIPP, SSAS and drawdown technology provider supports around a third of the market with its SIPP administration operating systems.
Tait's appointment follows John Watson joining Delta as chief financial officer in November 2016 and Mike Robins as chairman in December 2015. Both were appointed to continue the business expansion and accelerated delivery of the new platform.
Tackling SIPP complaints
SIPP advice has come under fire in recent months. In January, the Financial Services Compensation Scheme attributed the need to raise an interim levy on life and pensions advisers to the "unexpected" rising numbers of SIPP-related claims.
Meanwhile, recent figures from the Financial Ombudsman Service showed SIPP complaints had surged between October and December 2016. However, Delta chief executive Michael Power attributed parts of the problem to old technology being used by product providers and a resultant lack of data integration.
"There needs to be more integration under the bonnet, as firms and product providers cannot operate effectively as data islands," he said. "We have to be able to adapt, as to suddenly look into the thousands of underlying SIPP investments is very difficult for providers."
Power also pointed to the difficulty of obtaining data from discretionary fund managers (DFMs) in a standard format to be analysed for due diligence purposes. This comes as the Financial Conduct Authority (FCA) issued an alert in January 2017, highlighting that increasingly sophisticated scammers are using DFMs as vehicles for dubious non-standard investments.
Tait added: "Providers use legacy technology, which means re-engineering is too risky and too costly. That is why you see so many big names selling off parts of their business instead.
"Adding bits of new technology solutions on top of these creakingly old models also means these leading platforms make no money."
Outsourcing is the most efficient solution for advisers, said Tait, going on to say sophisticated technology allows US consumers to take better control of investments - the way pension freedoms intended in the UK.
He added: "The US market is instructive in this space, as it has already taken to this, which is part of the reason consumers are much more wedded to what is happening with their pensions."
Power also suggested the regulator imposes heavy expectations on what is possible for providers in the current market.
He said: "For the FCA, the definition of conduct is flaky and there is no clear definition as to what is a non-standard investment. Adjudicating regulation or guidance retrospectively currently makes due diligence hard.
"As there are only a few real underlying investment research firms there is also an escalation of that burden and the expectation to quickly find a cost-effective solution makes it even harder for providers."
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