Wealth platform Ascentric has announced its intention to enter the corporate wrap market this year, predicting an increased role for intermediaries.
Richard Goodall, sales & marketing director at Ascentric, said the firm was in a much better position than several life companies that have mooted launching similar propositions.
“We are a technology company, not a product provider,” he said. “We don’t want to just flog products; we want to provide the means of accessing investments.”
Friends Provident announced last year it was looking to enter the corporate wrap market by using a white-labelled platform provided by technology firm FNZ.
But Goodall questioned the value of this move. “What is a wrap? It’s technology and it’s people,” he said. “Why would you enter the market if you don’t own the technology or the people? ”
Ascentric is part of the Royal London Group, which also owns Scottish Life. The insurer has denied any plans to launch a corporate wrap.
Jamie Clarke, business development manager at Scottish Life, said: “I’m not sure there is enough demand out there to justify the initial investment. We will wait to see what comes out of the FSA’s [Financial Services Authority] thematic review of corporate wraps, but we are not looking to enter the market any time soon.”
In January, Steve Bee left Scottish Life for Paradigm Pensions, part of the Paradigm Group, where he is developing a distribution tool for the corporate market.
Goodall predicted the next five years will see the corporate benefits world imitating the wealth distribution model, where emphasis is more on the intermediary than product.
“Is brand going to be so important then?” he asked. “If not, why would you pay a premium for it?”
He added: “I’ve heard a lot of talk about people entering the corporate wrap market, but seen very little action. Aviva has been playing the hokey cokey – one minute they’re in, the next they’re out.”
Ascentric has 3,500 funds available on its platform and already hosts 25 firms’ self-invested personal pensions.
See page 34 for a report on the corporate platform industry
