Custodian Altruist has dropped its portfolio accounting software (PAS) fees for all its brokerage accounts..

The company, which is a newcomer to the custodian marketplace, says it made the move to ease the fee burden on advisors.

“When there are a lot of fees, it’s very difficult for advisors to serve without minimums and to serve everyone,” said Marc Greenberg, Altruist’s CFO. “So, what we’re trying to do is bring automation and simplicity to the process and allow advisors to serve more clients and serve the clients they do serve more effectively.” 

The Culver City, Calif.-based firm normally charges clients who custody their assets with the firm a $1 fee per account per month with the first 100 accounts being free. Recognizing that those expenses can accumulate during the year, the company said, it decided to eliminate the PAS fee altogether.

The firm said the move differentiates Altruist from its competitors by providing a low-cost option that does not exist in the industry. 

Eexpenses such as PAS fees limit RIAs' options on which investors they can work with, according to Jason Wenk, CEO of Altruist. The firm is optimistic that by eliminating its fees for clients, it can grant advisors greater flexibility, he said.

“By lowering expenses, eliminating barriers to entry (Altruist has no platform fees), and providing various methods for revenue collection with integrated fee billing, RIAs using Altruist have significantly more flexibility in how they choose to run their businesses,” Wenk said in a statement on the firm’s website.

Altruist caters to about 4,000 RIAs and provides them with a number of services, according to the firm. It helps in constructing portfolio models, creating fractional shares, conducting automotive rebalancing, providing performance reports, and supporting a digital experience, according to Greenberg.

He declined to say how many advisors will be impacted by its decision to drop the PAS fees. 

“Our mission has always been relatively straightforward and simple,” Greenberg said. “We want to make financial advice better, more affordable and more accessible and we want that to be accessible for everyone.”

The fee elimination follows a series of enhancements the custodian made to its platform over the past few weeks. Those updates included increasing ACH limits, integrating MoneyGuide, and making several UX enhancements to improve overall advisor efficiency. The firm also made user interface improvements for both clients and advisors and added enhanced performance reporting tools and a few key updates, the firm said.

“We’re trying to eliminate friction in the system that exists for RIAs to modernize their software stack and we don’t want costs to limit the advice they’re willing to provide,” Greenberg said.

The fee elimination is not one that the firm considers to be a temporary change but one it will maintain for a long time, according to Greenberg. There are no plans to expand the fee elimination to those advisors that manage their client’s assets in non-Altruist accounts.

“As a custodian we monetize the assets that are on the platform, that’s how we make money and we’re willing to trade it if you’re a brokerage customer,” Greenberg said. “If you’re not a brokerage customer we’re not eliminating the dollar per account per month portfolio account software fee.”

Those advisors will still pay the $1 per account per month fee although their first 100 connected accounts are free, according to the firm.