Written by Ben Cocks on Friday 29 June 2018
Genesis 11: “Behold, they are one people, and they have all one language, and this is only the beginning of what they will do. And nothing that they propose to do will now be impossible for them. Come, let us go down and there confuse their language, so that they may not understand one another's speech.”
It’s hard to build great things together when you don’t all speak the same language. Now I don’t want to comment on whether building a tower with its top in the heavens is a good thing or not but I’m sure that speaking the same language would help customers transfer their investment portfolios.
Transfer services in the UK are divided across multiple incompatible services. If both the new and old providers participate on the same service (in other words they speak the same language) then by and large the customer’s ISA or pension is transferred quite quickly. But if the two providers do not use the same service then the transfer tends to fall down the gaps.
So while a complex in-specie ISA transfer between two good platforms will complete very quickly (sometimes even in minutes), an in-specie SIPP transfer between a life office and a platform or a Cash ISA transfer between a bank and a platform may have to fall back to a paper process and take weeks.
Of all the services only TeX open transfers supports open standards and multiple interoperable system providers. In other words, TeX provides a common language that everyone can speak. It would be possible for the other services to interoperate with TeX but to date this has not progressed.
Back in 2015 the FCA noted the wide variation in transfer times and challenged the industry to fix it. The industry responded by forming a new working group with an exciting acronym (TRIG) and a rather more prosaic long form (Transfers and Re-registration Industry Group).
The TRIG team had a good grasp of the problem and expertly articulated the challenges around standards, governance and interoperability in their initial report. The consultation that followed revealed overwhelming support across the industry for interoperability between services.
But persuading all the transfer service providers to talk to each other isn’t that easy and TRIG in its final report (just released) has decided not to tackle interoperability but restrict its recommendations to transfer times and customer communications. The FCA has been less vocal on transfers of late and may not now be as focused on transfers as they once were.
So it seems that some customers must wait for their transfers while we continue to babble away to each other for a while yet.