(Bloomberg) -- The U.K. Financial Conduct Authority set out the framework for a market study into the use of online platforms to sell investment products to consumers.
The platform market has grown rapidly in recent years, handling as much as 500 billion pounds ($650 billion) of assets under administration last year, up from 108 billion pounds in 2008, the FCA said. Hargreaves Landsdown and Vanguard Group offer online portals to sell funds.
Platforms can allow retail investors to compare products and pool their money, achieving better returns.
However, the FCA said the relationship between providers, asset managers and financial advisers had the potential to distort “competition by encouraging platforms to compete in the interests of those with which they have commercial relationships rather than in the interests of the consumer.”
“With the increasing use of platforms, and the issues raised by our previous work, we want to assess whether competition between platforms is working in the interest of consumers,” said Christopher Woolard, the FCA's executive director of strategy and competition.
The FCA plans to publish an interim report by summer 2018, setting out preliminary conclusions and areas of concern.
To contact the reporter on this story: Kit Chellel in London at cchellel@bloomberg.net.
To contact the editors responsible for this story: Anthony Aarons at aaarons@bloomberg.net, Neil Callanan
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