The future of financial services is switching online judging by the success of a wrap platform that has grown by $8 billion in three years, is pulling in more than $100 million a week and is showing no signs of slowing.
’s flagship wrap platform, North, has just hit $10 billion in Funds Under Advice (FUA), which marks a five-fold increase since it launched in 2011 as a full wrap platform with $2 billion in FUA.
Steve Burgess, director of platforms for AMP, told Wealth Professional
that he absolutely sees the future of financial services heading online – but it won’t diminish the importance of face-to-face contact.
“I know there’s some resistance amongst advisers about that, and there are some legitimate concerns, but you can’t hold back the tide. Clients are increasingly asking for it. What part of our lives aren’t online anyway?” he asked. “I think it means that the adviser can focus on the real value they can add [in person]. I absolutely believe in the value of face-to-face contact.”
North, which was built out in the first quarter of 2011 after AMP acquired AXA, has been successful due to its functionality and modern technology, Burgess said.
The technology is configurable and can be adjusted relatively cheaply in the case of future trends, which helps it stay competitive, relevant and efficient.
“It gives [advisers] real control and flexibility in their practice,” he said. “It does mean they have to do some of the administration work, but once that’s done it’s far more efficient. They can manage their clients online in real time and purchase direct equities. As an all-rounder it really stacks up.”
And as well as having state-of-the-art share trading capabilities and a model portfolio function that allows advisers to put together their own portfolios from the menu, North offers “very significant” term deposits with AMP, Westpac, Adelaide and ANZ.
“I think North is unique in the market because it has four major bank term deposits on the menu,” Burgess said. “Most of our competitors are owned by banks so they only offer their parent bank. After we went through a difficult year with GST, term deposits were a major bolthole for investors – but no bank is the best at every term, so having for on the menu is very important.”
And to add to the $10 billion FUA price tag, AMP has just moved the old AXA books over to the same technology that supports North. Called North Platform, the migration has been one of the biggest consolidations in the platform industry with the transfer of 131,000 customers, and more than $14 billion in FUA.
“I think that’s a really good scale position. Many of our costs are fixed and our revenue grows with the fund,” says Burgess. “This is the flagship wrap platform that AMP has, and I think the future is pretty cool.”