SIPP client interest skimming concerns 'overstated', providers argue

Pensions experts respond to concern around interest

Nicola Brittain
clock • 3 min read

Concern some self-invested personal pension (SIPP) providers rely on creaming interest from their clients' bank accounts is ‘overstated' and actually part of a well-established SIPP business model, providers have said.

Earlier this week, Finalytiq's Abraham Okusanya told delegates at the Retirement Planner Forum that SIPP providers are currently taking up to £50m a year in interest from their clients' cash accounts and may struggle to stay afloat without the income. Okusanya also said that the Financial Conduct Authority (FCA) was interested in preventing providers from harvesting the interest on cash accounts in the first place. The move might be the inevitable next step for the regulator following its push for increased disclosure and transparency in November last year, he told delegates on 14 Jun...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Why is it so difficult to switch a pension? Navigating the transfer maze

Why is it so difficult to switch a pension? Navigating the transfer maze

‘If I didn’t work in pensions, I might have simply given up on many occasions

Lisa Picardo
clock 08 April 2025 • 4 min read
Many savers not accessing guidance or advice ten years on from pension freedoms

Many savers not accessing guidance or advice ten years on from pension freedoms

Fewer people understand their options now compared to three years ago, IFoA finds

Holly Roach
clock 07 April 2025 • 4 min read
Pensions consultancy calls for 'fairer' Financial Ombudsman Service

Pensions consultancy calls for 'fairer' Financial Ombudsman Service

First Actuarial says pension redress sitting at ‘historic low’

Holly Roach
clock 04 April 2025 • 1 min read