The U.K. Financial Conduct Regulator has published a statement on the results of its review of the investment platforms market. The FCA launched its Investment Platforms Market Study in 2017 to investigate whether competition between investment platforms was working in the interests of consumers. Investment platforms enable consumers and financial advisers to review investment opportunities across a range of funds and execute and change their investments. In 2019, the FCA published a Final Report which concluded that consumers should be able to switch more easily between investment platforms, and proposed a series of measures to help achieve this. It also announced that it would review the industry's progress in adopting these measures in 2020/2021. The FCA's statement sets out the results of that review.
The FCA found that, for non-advised consumers, certain activity-based charges imposed by platforms were not transparent and information was difficult to find. The FCA expects platforms to make existing and potential clients aware of all costs and charges, as well as total aggregated costs and illustrations showing the effect of costs on returns, in advance of providing the investment business. Platforms should also consider the FCA's upcoming Consumer Duty, the final rules for which are due to be published by July 31, 2022, for example by testing whether communications support consumer understanding in practice.