News that Barclays Smart Investor has changed its fee structure is better news for rival wealth platforms AJ Bell PLC (LSE:AJB) and abrdn PLC than Hargreaves Lansdown PLC (LSE:HL.), suggest analysts at Citi.
Barclays has scrapped its £4 monthly fee, with a fee now based on a percentage of monthly balances.
Trading costs have also been reduced to £6 while fund dealing will be free.
Citi adds that Barclays’ new fee structure includes 300 basis points (3%) plus of cash margins, which is likely seen as a positive for the sustainability of cash margins under Consumer Duty.
“Barclays likely believes that fair value criteria are met when considering holistic value.
“This argument has more credit for AJ Bell and abrdn in our view, than for Hargreaves Lansdown given the latter’s fees are significantly above peers.”
AJ Bell and abrdn, which owns Interactive Investor, are rated 'neutral' while Hargreaves remains a ‘sell’ for Citi.