Competition is working well for most consumers using investment platforms, according to the interim findings of the Financial Conduct Authority’s (FCA) market study into investment platforms, published today.

However, the FCA’s interim findings also reveal concerns about how platforms compete for particular groups of consumers. Given the rapid growth in this market, the FCA is proposing measures to address these problems before they get bigger.

With £500bn of assets under management, the investment platforms market has almost doubled in size since 2013. During the same period, an extra 2.2 million customer accounts were opened. As consumers become increasingly dependent on investment platforms to manage their investments it is vital that competition between platforms is working well.

Christopher Woolard, executive director of strategy and competition at the FCA, said: “This is a market that has seen significant growth in the past five years with more customers than ever deciding to use a platform to manage their money. We know that competition is working well for many but it is important that the problems we have identified are addressed so that consumers don’t lose out.

“We have outlined a package of measures today to address the issues we have found, but we also want to see the industry step up, making it easier for consumers to transfer from one platform to another.”

The FCA has found that competition is not working as well as it should do for some consumers. The FCA is concerned about consumers:

The FCA has proposed a package of remedies targeted at these five groups of consumers to address the concerns that it has identified. These include measures to help strengthen the extent to which platforms drive competition between asset managers, measures to make it easier for investors and advisers to switch platforms, tackling price discrimination between orphan and existing clients and measures to alert customers who are holding large cash balances.

The FCA recognises that industry is currently taking steps, including implementation of MiFID II, to help consumers shop around on the basis of price. The FCA also acknowledges that the Transfers and Re-registration Industry Group is currently taking forward an initiative to improve the switching process and reduce transfer times.

Between interim and final report the FCA will assess industry progress in these areas before deciding whether it should introduce additional remedies.

The FCA is seeking feedback on its initial findings and proposed remedies before publishing its final conclusions about the market in early 2019.