Over half (54%) of advisers say that current cash interest rates on platforms have helped them attract new clients, according to new research.

The current high cash interest rates have directly influenced advisers’ ability to attract new clients, according to the research from Transact.

Earlier this year as part of its work on the new Consumer Duty, the FCA stated that platforms should not skim interest off cash holdings and charge platform fees simultaneously if it stops platforms providing fair value to customers.

The research from platform Transact, which pays interest to advisers and their clients, confirmed that avoiding so-called 'double-dipping' can provide cash interest rates that provide fair value and also attract new customers to platforms and advisers.

The platform said the Consumer Duty has also led to platforms providing better communication on their fees.

The majority of advisers (83%) surveyed said they were aware that cash interest charges should be disclosed in client illustrations on costs and charges.

Advisers also understand they can also reduce customer platform charges by linking portfolios, resulting in lower annual fees. The majority (93%) of survey respondents said they have discussed the benefits of tiered discounts for family-linked portfolios with their clients.  

Tom Dunbar, chief development officer at Transact, said: “We have had an ongoing commitment to transparency around cash interest and do not retain interest from the cash holdings of our clients.

"This, combined with our leading functionality, personal service and API integrations has attracted more advisers and clients to Transact. In the first quarter of 2024 we saw record new adviser registrations at 499 up 30% and then a net increase of 2,500 clients in the second quarter."

• Transact surveyed 227 financial advisers in August.