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Growth of platform assets sees “whopping increase”

Fund platformGrowth of assets on fund platforms used by financial advisers has reached over 5% so far this quarter, beating the growth of the FTSE All Share index, which stands at 3.1%.

Platforum, a platform research and advisory business, also described the year-on-year growth for adviser platform assets of more than 20% as “a whopping increase”.

The firm acknowledged that market performance has been an important factor, though this “wasn’t the whole story”.

Flows to pension wrappers make up 82% of net sales so far this quarter, with defined benefit to defined contribution transfers boosting these sales.

Growth for certain firms is being led by acquisitions. Assets under administration for Aegon, which received regulatory approval to buy Cofunds last month, are up 9.4%.

Platforum says increasing their scale is helping adviser platforms deal better with regulatory change and “constant demands” to invest in technology, and to prepare for a possible “price squeeze”.

Miranda Seath, senior researcher at Platforum, indicated they have some doubts about platforms.

“We don’t envisage a scenario where a platform will suddenly fail, although advisers have told me that they worry that this could happen.”

She added that uncertainty would “undoubtedly influence advisers’ approach to their platform due diligence”.

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