More than a quarter (28%) of financial advisers have changed one or more of their preferred platforms in the last 12 months, new findings published by Defaqto have indicated.

This figure is an increase on 19% who said the same last year.

Defaqto suggested that advisers are not limiting themselves to a single financial services platform in order to improve experiences for their clients ahead of the Consumer Duty regulation. The new rules being introduced by the Financial Conduct Authority (FCA) to improve customer protection are due to come into force from 31 July.

The annual survey conducted by the financial information and ratings firm measures the satisfaction of financial advisers with their preferred providers, also identifying where their expectations are being met.

“The consolidation of the financial advice market, which means we are seeing a decline in the number of small firms, is also impacting platform distribution deals,” commented insight consultant (wealth management) at Defaqto, Darren Winfield.

“Advisers are moving clients over to their preferred platform or even becoming platform operators themselves to reduce costs for clients and meet their PROD requirements.”

Defaqto also suggested that post-pandemic, advisers are more confident in changing platforms for their clients, either because of service or to improve the client’s experience and cost. The firm suggested this is likely to be further impacted by the coming Consumer Duty regulation, which is encouraging firms to assess many elements of their service offering and find ways to improve experience and accessibility for clients.

The number of advisers changing platforms has been steadily increasing each year since 2018, a slight drop in 2021 aside, which is expected to have been due to disruption from takeovers and mergers and a period of technology upgrades.

Defaqto also revealed that the top preferred platform providers were Aviva, Quilter, Fidelity Adviser Solutions and AJ Bell, while Hubwise was measured as the platform with the greatest increase in support. In total, 16 providers received sufficient adviser nominations as preferred providers to be awarded a Defaqto service rating.

Winfield added: “Advisers need to have clarity with their choice of platform and be prepared for consumer duty and ensure that their platform of choice is also ready.”

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