Barclays Smart Investor has finished last in Which?’s annual survey of the best and worst investment brokers after customers branded the new service ‘appalling’.
The consumer champion compiled a list of unique reviews and ratings for 12 leading brokers based on a survey of 2113 members – the only research of its kind available.
A successor to Barclays Stockbrokers, users criticised the new platform and the length of time it has taken to transfer their assets, with some saying it has taken up to three months, during which time they have been unable to buy or sell their investments. Barclays Smart Investor received a customer score of just 33% – more than 20 points lower than its predecessor.
Brokers meddling with a longstanding service is always likely to upset some users, but the outcry over the Barclays overhaul has been exceptional. ‘The move has been nothing less than catastrophic,’ said one user. ‘The new service is appalling, with most of the good parts of the previous offering being replaced with a truly inferior alternative.’
Those surveyed penalised Barclays with one-star ratings in every category but value for money, where it received two stars. Members gave it an overall customer score of 33%, the lowest any broker has scored in the five years Which? has done this survey.
In response to Which?’s queries, Barclays said it has waived the final fee relating to the old service for all customers, and that it did not start charging fees for Smart Investor until November 2017 – having launched it in August last year.
At the opposite end of the table, Hargreaves Lansdown was a comprehensive winner for the fifth year in a row with a customer score of 76% – meaning it has come top every year since this survey’s inception.
HL’s customers enjoy the range of research available to them and the easy-to-use website. If they do need help, they can get straight through to a competent person on the phone, without first having to negotiate a lengthy automated menu.
‘The platform is easy and quick to use, and presents good information about current holdings and values,’ said one person, adding: ‘Any queries I’ve had seem to be quickly resolved by HL helplines.’
The only gripe with HL tends to be value for money because it involves an annual fee of 0.45% – which penalises those with bigger investments – particularly over £50,000.
Which? also crunched the numbers regarding broker fees for different portfolio sizes. For investors with portfolios of up to £10,000, HL is a good option because charges are a percentage rather than a fixed annual fee.
But once portfolios start to grow it’s worth considering AJ Bell Youinvest or The Share Centre. Youinvest charges a percentage in the same way as HL, but significantly lower at 0.25%. The Share Centre, on the other hand, charges a fixed £4 plus VAT per month for an Isa (£57.60 per year total).
At £50,000, the brokers charging fixed amounts start to overtake those charging a percentage as the most cost-effective choice. Halifax Share Dealing is the cheapest for a £50,000 portfolio of funds, assuming two trades a year (although most brokers don’t charge to trade funds), at just over half the price of the next most expensive.
Once you pass the £200,000 mark, The Share Centre becomes an even more appealing choice. It came joint second place in the table, and received four stars for several crucial criteria, including value for money, clarity of charges and customer service. While not as cheap as Interactive Investor or Halifax Share Dealing, it’s still far less expensive than top-scoring HL.
Harry Rose, Which? Money Editor, said:
“Clearly Barclays’ customers feel badly let down by its new platform and this has been reflected in its abysmal customer score – the worst we’ve seen.
“People who are disappointed with their current broker should prioritise the services that matter to them most and shop around to see if their current broker offers value for money. If your portfolio has increased in value you may be overpaying and it could be time to switch.”
Notes to editors
- The survey was based on a survey of 2,113 members, conducted in March 2018.
- Which? asked members to rate their investment broker in several categories (see table below). Customer scores are based on how satisfied customers are and how likely they would be to recommend their broker to a friend or family member.
- There had to be a minimum of 30 customer score responses for a brand for Which? to include it.
- Barclays’ full statement, attributed to a spokesperson, was as follows: “Smart Investor is the first platform in the market to fully integrate customers’ investment accounts with their online banking, meaning they can see their investments alongside their day to day finances. We recognise the move was a big change for our Stockbrokers customers and that for some it didn’t go as smoothly as we would have liked. We sincerely apologise for this. In recognition we waived the final Barclays Stockbrokers fee for all customers and did not start charging customers fees on Smart Investor until November 2017.“In light of customer feedback we also implemented some key changes, such as giving the choice to see daily price changes or long term performance against book cost, and the ability to quickly export portfolio data to Excel. We are continuing to develop the service and add further functionality. Smart Investor is working well and delivering against our goal to create a new service, with a transparent pricing structure, that opens up investing to all.”