Providers taking far too long to transfer assets

THE TIMING of when an investment is made and held can be crucial. This applies to a single share as well as to a bond or a collective. Savers rightly expect whatever intermediary they use to expedite instructions correctly and without delay.

Yet many will be in for a shock to discover that their provider/ broker can be as lethargic as they wish as their sleepy regulator, the tortoise-like Financial Conduct Authority (FCA), has produced no rules over how long transferring assets can take.

Some providers either by accident or design provide insufficient staff to handle transfer requests.

One recent financial example is where Barclays decided to introduce a new platform to hold customer investments. Several of its previous stockbroker facilities were withdrawn including nominating one account holder to manage a family member’s holdings. The bank had not anticipated how many would walk and have not been able to keep up to its expected high standards.

The bank quoted six to eight weeks for transferring assets to another provider. In itself, this is an excessive time. Yet later it changed its estimate to 14 weeks. It has actually been taking over five months to effect transfers. The industry provides “guidelines” but this is a mealymouthed phrase. It expects up to 15 days to be taken for moving a cash ISA and twice this time for a stocks and shares version.

Providers do not need to have everything ready together before making a transfer. There is no reason why a depositbased ISA cannot be despatched whilst slightly more time may be required for a stock market version. Yet this is another misunderstanding or delaying tactic used by providers whose customers are leaving them.

If a saver has decided to switch, the time out of their chosen investment can have a sizeable effect as the surge in the stock market last autumn typified. It’s high time the FCA awoke from its winter slumbers and issued rules.