Amid speculation that Self-Invested Personal Pension (SIPP) fees will have to rise following the Financial Conduct Authority’s (FCA) latest review of the industry, one provider has announced that their fees won’t change for the next 12 months.
Xafinity has announced they will be freezing their SIPP fees on both their Full SIPP and SimplySIPP products until September 2015.
SIPP fee rises
Concern has been mounting that SIPP providers will need to increase fees in the wake of the FCA’s latest review into the industry, which will force many SIPP providers to increase the levels of capital they hold.
SIPP providers which allow a wide range of investments, including those which are unregulated or deemed to be ‘non-standard’ by the FCA, will be hardest hit. Some providers have already increased fees, whilst others have merged or been taken over.
Indeed research by Xafinity has shown that 62% of advisers have seen a rise in SIPP set up fees, whilst 94% have seen an increase in annual fees.
Andy Bowsher, Director of Self Invested Pensions at Xafinity, said: “Fees are currently a highly emotive issue in the market, and many financial advisers that we speak to believe that some providers are abusing their contractual ability to increase fees. Our view remains that we will charge fees on the basis of the costs to manage the accounts and, for this reason, we are delighted to be able to freeze our fees for another year.”
Bowsher continued: “Fees are however only part of the package and that is why we continue to deliver a high quality and personal service to all our customers. We provide dedicated single point of contact in our administration team for all financial adviser firms, backed up by a very strong technical and compliance team.”
“Xafinity is also a well-capitalised SIPP provider and we are in a very comfortable position against the recent announcement by the FCA in respect of capital adequacy requirements. We were prudent and disciplined in our approach to unregulated investments in the years when some providers were not so. We currently hold capital well in excess of both the current and recently announced future FCA requirements.”
