Betterment Launches Pilot of RIA Referral Program

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Betterment has launched a pilot of its deliberate shopper referral program for a choose group of registered funding advisors utilizing its custodial platform, in accordance with the agency and a current regulatory submitting.

The RIA custodian, robo advisor and 401(ok) plan supplier has began the Betterment Advisor Community to “join choose Betterment retail purchasers with unbiased RIAs on our platform for ongoing, personalised recommendation,” in accordance with an emailed assertion. “We’re starting with a restricted pilot program for a small group of advisors and plan to increase over time as we be taught extra about shopper demand and advisor wants.”

If a retail shopper elects to take part within the referral program, they’ll obtain the names and make contact with info of a number of advisors utilizing Betterment’s custodial providers, in accordance with a Feb. 10 regulatory submitting. The advisor and shopper can then work out an settlement for providers, with Betterment charging the advisor a 0.25% annual price on the referred shopper’s account belongings.

“BAN Suggested Purchasers who enroll within the referral program could also be referred primarily based on their monetary scenario and funding preferences, equivalent to service wants, value concerns, location and desired communication (distant or in-person),” in accordance with the submitting.

The agency launched the referral program to lure RIAs from custody giants Charles Schwab and Constancy Investments, whereas additionally keeping off different tech-focused rivals equivalent to Altruist and Robinhood/TradePMR. 

Final yr, BNY Pershing and Goldman Sachs’ Ayco additionally disclosed in regulatory filings that they’d, or would quickly launch, shopper referral applications.

New York-based Betterment at the moment has about 600 companies on its custodial platform, in addition to 1 million purchasers throughout each retail and advisors representing greater than $60 billion in belongings.

Earlier this week, the agency introduced it had added asset supervisor choices to its mannequin market from Goldman Sachs, State Avenue Funding Administration and Vanguard.

“Advisors are utilizing our mannequin market to deliver institutional funding experience into their companies with much less overhead,” Alison Considine, director of technique and operations at Betterment Advisor Options, stated in an announcement.