Four mutual fund companies have teamed up to launch an Internet portal designed to give independent advisors access to a wider swath of mutual fund families, consolidated mutual fund account data, mutual fund transaction capabilities, and processing and customer service.
Advisors have been crying for these types of services, as well as the ability to "transact purchases and redemptions from [mutual fund] family to family, and do it on one portal," says Ken Rathgeber, Executive VP and COO of Fidelity Investments Institutional Services. "This is a transaction that big wirehouses have access to through National Securities Clearing Corporation (NSCC). We want to make that available to the smaller planner."
The portal, to be up and running by September, is being developed by Fidelity Investments Institutional Services Company, Inc. of Boston; Franklin Templeton Investments of San Mateo, California; Putnam Investments of Boston; and PFPC Inc., a member of The PNC Financial Services Group, Inc., of Wilmington, Delaware.
The as-yet-unnamed portal will be modeled on PFPC's existing Internet platform, IMPRESSNet, which provides one-stop access to mutual funds, client account information, and transaction capabilities. PFPC, which bills itself as the largest mutual fund transfer agent and the second-largest provider of mutual fund accounting services, caters to approximately 100 mutual fund families. But together, the four fund companies represent 42% of the mutual funds sold through intermediaries, so the joint portal's content and technology capabilities will be broader than PFPC's platform.
The Internet portal will relay information to the NSCC, which will allow financial intermediaries to obtain information from transfer agents on shareholder accounts in real time using XML format through an XML switch.
Kenneth Arthur, Senior VP of PFPC's e-commerce division, says the joint portal's target "book of business" is about 30,000 investment advisors. He's also quick to point out that the portal is open to all mutual fund companies. "We would hope to get that 42% up over the next few months. The portal will be more valuable if the number of mutual fund families participating goes up," he says.
PFPC has been looking to further tap the advisor market, Arthur says, and the portal's infrastructure will "make it easier for RIAs to do business with us."
Fidelity's Rathgeber says regional broker/dealers also want to use the portal to supplement their front-end systems and to offer their reps access to aggregated accounts.
"We were hearing from investment professionals about the value in consolidated information," says David Haslemann, manager of Franklin Templeton's E-Service Group. He says the portal's account aggregation capability will cut down on the time advisors usually spend jumping from various mutual fund companies Web sites.