Hargreaves Lansdown shares became the FTSE 100’s biggest faller on Monday, after Financial Conduct Authority said it may ban companies from charging exit fees that discourage customers from moving their accounts elsewhere.
The FCA found that consumers were often put off making a switch due to it being difficult and time-consuming, as well as costly. Many firms charge ‘exit fees’ for clients looking to close their accounts.
“Many advisers told us that they charge additional advice fees for switching platform because it is a full advice event which requires them to produce a suitability report”, the FCA wrote”‘
“We recognise advisers need to be fairly paid for their work. But it is not clear to us why meeting suitability requirements to switch platforms should outweigh the benefits of switching platform.”
Investment platforms will be heavily hit from the news, with fees such as these a large source of revenue.
Hargreaves Lansdown (LON:HL) shares were the worst hit by the news today, currently trading down 4.11 percent at 1,972.50 (1006GMT).
