Adviser support key for HUB24 and Netwealth

Superannuation rollovers and adding financial advisers and licensees remain paramount to the growth prospects of platform providers HUB24 and Netwealth, according to a recently-published analysis.

The analysis, published by Wilsons Advisory, has concluded that the rollovers are a more important factor to the two platform than even the increases in the superannuation guarantee (SG).

The firm said that the increase in the superannuation guarantee had, as expected, provided to be a minimal contributor in terms of inflow sources for both HUB24 and Netwealth.

It said the real driver of super inflows had been rollovers and successor fund transfers.

“Our analysis highlights that for the last few years the SG contribution to Super Gross Inflows has been only 4-7% of the annual total with Personal Contributions (voluntary, salary sacrifice) making a more meaningful contribution,” it said.

“This is why HUB and NWL must continue to have a market-leading value proposition in order to ensure continued market share gains,” the analysis said.

It said that while HUB and Netwealth had achieved significant success in taking market share, at the end of the day, the quantum of the growth in their funds under administration in superannuation primarily boiled down to adding new accounts, advisers and financial intermediaries.

The analysis said that this would continue to be important for both platforms in circumstances where incumbents such as Insignia, AMP, CFS and BT were reasserting themselves.

“Given rollovers are a key driver of net new member growth and ultimately FUA it is absolutely critical in our view that both platforms ensure a superior value proposition relative to peers in order to continue to attract volume,” it said.

The analysis said that pricing would remain an important variable into continuing to attract volume and that administration fee compression would persist, particularly as account balances grow into lower cost tiers.