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Investment platform transfers "a clear example of market failure"

ended 22. May 2025

Moving from one investment platform to another, in 2025, ought to be a breeze. But according to Faisal Sheikh, Managing Director at Monmouth Capital, it can be a protracted or costly nightmare, leading to poor customer outcomes.

“In the digital age, the administrative and fiscal challenges people face if they want to move their funds from one platform to another leads to poor customer outcomes and restricted choice. It is a clear example of market failure. This is why the regulator exists and I implore the FCA to look into this matter urgently.”

Sheikh says the  simplest and quickest way to switch platform is to sell all assets on one platform and transfer the proceeds as cash. But that can take a week or two and there are risks.

He highlights the volatility following Donald Trump’s “Liberation Day” on 2nd April as a useful reminder of the danger of being in cash and missing out on spectacular moves. There is plenty of research showing how excluding a handful of the best days in the market can make a significant difference to returns.

Also, if your portfolio is not in a tax wrapper such a pension or an ISA, selling assets means crystallising capital gains tax liabilities, which can be significant.

The other option to move platforms is the "in specie” transfer, but this can be slow, with Sheikh saying one in specia transfer he is dealing with has taken almost 12 months.

Newspage asked IFAs and investors for their views, below.

4 responses from the Newspage community

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Scott Gallacher
Director at Rowley Turton
In 2025, platform-to-platform transfers — especially in-specie — simply shouldn’t take 6 to 12 months. These delays cause undue anxiety for clients and waste valuable adviser time. It’s difficult to see how this aligns with the FCA’s Consumer Duty requirements or TCF Outcome 6, which states that 'customers do not face unreasonable post-sale barriers.' The current system risks costing clients through missed investment opportunities — or nudging advisers and clients into sticking with the existing platform to avoid the hassle. If this isn’t a clear case of market failure, then what is?
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Rob Mansfield
Independent Financial Advisor at Rootes Wealth Management
The problem is that there are so many moving parts involved. You've got the two schemes and then every fund administrator. If you've got 8 investments that's 10 parties and the transfer is only complete once the final one settles. What I've seen is that most will move quickly but the weakest link slows down the whole process. I've seen platforms contact the UK administrators of a fund when it was an Irish fund and it gums up the process. To make this work, everyone needs to be on the same page but sadly administration standards vary hugely.
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Faisal Sheikh
Managing Director at Monmouth Capital
In the digital age, the administrative and fiscal challenges people face if they want to move their funds from one platform to another leads to poor customer outcomes and restricted choice. It is a clear example of market failure. This is why the regulator exists and I implore the FCA to look into this matter urgently.
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Kundan Bhaduri
Entrepreneur, Investor and Landlord at The Kushman Group
The platform transfer scandal is the financial equivalent of being forced to communicate by carrier pigeon in the age of smartphones. I've never seen anything quite so brazenly anti-consumer over the years, when transferring funds across to a competitor. I speak to colleagues who are hostage for 6+ months waiting for their life savings to transfer, while platform executives collect bonuses fueled by the £900 million annually extracted from captive customers. These aren't minor inconveniences. They can be life-altering penalties. Just missing April's 7.3% post-Trump market surge could have a massive impact. The solutions are embarrassingly simple: mandatory 30-day transfer limits with daily penalties for non-compliance; a centralised asset registry like CREST for equities; and standard digital protocols that platforms must adopt. Australia implemented these reforms in 2021 and slashed transfer times to under 5 days. In Britain, we still allow FS giants to operate like the wild west.