Investors head to Hargreaves in search for better returns: Platform gains 31,000 new customers over the summer
Hargreaves Lansdown saw 31,000 new customers pile on to its platform over the summer as savings rates elsewhere were slashed and investors pinned their hopeson a stock market recovery.
The funds supermarket is now looking after £106.9billion of savers’ money, up 3 per cent since June.
Customers rushed to the platform after the Government-backed NS&I cut its market-leading interest rates on cash savings in September.
In demand: Hargreaves Lansdown is now looking after £106.9bn of savers’ money, up 3 per cent since June
Hargreaves said that it saw a ‘marked impact’ on flows of money back into its Active Savings division when NS&I lopped its rates.
The Active Savings service allows customers to chop and change between the best cash savings accounts offered by banks, without having to go into a branch and open an account every time.
The influx will be a welcome boost for Hargreaves, which faces legal action over its role in the downfall of Neil Woodford’s investment empire.
A number of law firms are looking into bringing a claim against Hargreaves on behalf of its customers, after it recommended Woodford’s doomed Equity Income fund right up until its suspension last year.
But the pandemic, and the stock market volatility it has caused, have given Hargreaves a helping hand.
Savers stopped to reassess and organise their finances during lockdown, prompting many to start investing, while others tried to take advantage of the wild market swings by trading more stocks and funds.
Hargreaves’ revenue hit £143.7million in the three months to September, 12 per cent higher than the same time last year.
Much of this rise was due to fees from increased share dealing by its customers, it said, who averaged a total of 980,000 deals per month.
However, despite adding 31,000 customers, this only brought in £800million of new business for Hargreaves, which was less than analysts expected.