Nutmeg introduces private banking for regular people
08 October 2012 | 5607 views | 0
Nutmeg, an online investment manager promising to offer private banking-type services for everyone, has launched in the UK.
Most Brits do not believe that they have enough money with which to invest, while more keep their savings in cash at home than in stocks and shares ISAs, according to a Nutmeg-commissioned survey.
The start-up is hoping to take advantage of this with its online service for anyone with at least £1000 to invest. Users set their risk level, timeframe and contributions and Nutmeg staffers build and manage discretionary, diversified portfolios for them. Customers can open and transfer ISAs, start as many funds as they like and top up, withdraw or transfer their money at any point.
The company claims that its service offers a more flexible, straightforward approach for Brits wanting to invest in stocks and shares. It also says it is cheaper, with annual management charges starting at one per cent, compared to the industry average of 1.36%. A loyalty scheme, where users can collect 'nutmegs' through referrals and pounds invested, lets users reduce the fee further, down to 0.3%.
FSA-regulated, Nutmeg is officially launching following a private beta period and the completion of a £3.4 million funding round led by UK-based venture capitalists Pentech and Daniel Aegerter, the Swiss chairman of Armada Investment Group.
Another investor, Tim Draper - an early Skype and Hotmail backer - says: "Financial services is one of the few industries to have withstood the Internet revolution. I'm convinced that Nutmeg is the right company to bring democracy and transparency to a sector which is ripe for reform."