Investors hit by transfer delay shambles Each platform charges different fees, which drag on returns. For example, a £100,000 nest egg in funds growing at 7pc a year would be worth £105,624 after 12 months with a more expensive platform, compared to £106,057 at cheaper rivals, figures for Telegraph Money show. Moving to a new provider should take a maximum of 30 days, industry experts say. But this year fund supermarkets have been so inundated with transfer requests they simply cannot cope. An enormous backlog has built up, leaving some savers in limbo for months. The problem is exacerbated because many companies outsource this type of administration to three major firms - Skandia, Cofunds and Fidelity FundsNetwork. Others have failed to invest in new technology that can cut transfer times to five days, while form-filling errors have added to the burden. Sources say many firms simply have insufficient staff to deal with the sudden increase in workload. Justin Modray, founder of comparison site comparefund platforms.com, said: "Some platforms appear to be dragging their heels. Unless the industry gets its act together to ensure fast transfers it risks sinking under a mountain of complaints. As well as leaving customers paying higher charges for longer, the long delays can prevent investors taking action if markets crash, or grabbing a sudden investment opportunity. The system blockage is also creating delays for savers who want to transfer a cash Isa to a stocks and shares Isa, thereby keeping the tax break. For example, a saver moving from cash to shares hit by a delay between January 1 and February 28 would have missed out on a 7.85pc gain in the FTSE 100, according to data analyst Morningstar. Jason Hollands, director of fund supermarket firm Bestinvest, said: "This is an industry-wide issue stemming from reforms that took place in January. For the time being investors may have to lower their expectations of how long transfers will take. Tens of thousands of savvy customers have moved their investments since new rules were introduced in January by the Financial Conduct Authority (FCA), formerly the Financial Services Authority. The new rules, called the Retail Distribution Review, banned financial advisers from taking commission payments from investors' funds each year. They must now charge investors directly. As a result, many advisers have moved their customers on to cheaper fund platforms to make the overall cost seem more palatable, creating a flood of transfer requests. The end of the fund commission has also seen one in four financial advisers quit the market, leaving their clients to fend for themselves. Many of these so-called orphaned investors have switched their holdings to do-it-yourself websites, creating extra work for back-office staff. Alliance Trust Savings, for example, reported seven times the number of transfers in during the first three months of 2013, compared to the same period in 2012. In the past, investors simply sold their holding, turned them into cash, and the money was sent to the new provider. But under RDR rules all fund supermarkets must accept direct switches where no fund units are sold. This process, called an "in specie" transfer, means savers stay invested in the markets and benefit if share prices rise. However, it also involves additional red tape and staff training. The failure of many firms to adopt new electronic transfer technology is another sticking point. These five-day automatic moves are only possible if every link in the chain - both the old provider, new provider, and fund groups where the money is invested - are signed up. Many firms still process paper documents by hand, leaving room for errors that add to the delay, and forcing all parties to rely on the postal system. Patrick Mill, managing director of Alliance Trust, said: "The industry's response to the higher level of transfer activity has been too slow. It is frustrating because the delays are coming from the companies releasing customers' money and there is little we can do to speed things up. Skandia, a popular fund platform with financial advisers, has employed 40 extra staff to deal with requests. Fidelity has also increased staffing levels. Under normal circumstances, fund supermarkets start to chase delays after 21 days. But customer service staff at one firm told Telegraph Money this deadline had been extended to six weeks at "most companies." Ian Williams, managing director of low-cost fund investing website Cavendish Online, said the industry-wide backlog could last "another six months" and compared it to transferring a bank current account 10 years ago. But others believe the bottleneck could get worse next year when all fund supermarkets are forced to charge their customers upfront fees, rather than take commissions from the funds they sell. For many companies, this means moving customers from funds loaded with commission to so-called "clean funds" where it is stripped out. A spokesman for Fidelity FundsNetwork said: "Unfortunately, the regulation surrounding re-registration did not stipulate that providers must also have electronic automation, which we introduced at the beginning of the year." A spokesman for Skandia, which has twice as many inflows as outflows of customers, said: "We are lobbying for the entire industry to adopt the new technology as the chain is only as strong as its weakest link." Investors wishing to switch broker are recommended to keep records of all dated correspondence in case delays turn into disputes. Do not give instructions over the phone - make sure they are given in writing or by email, where records can be kept. If broker delays mean you miss out on investment opportunities you would need to demonstrate an intention to have invested, along with evidence of your loss, if you are to make a claim.