Royal London Asset Management has become the latest fund house to shift its pricing strategy as it will move to a single, fixed fund management fee from the start of June.
The company stated its new fund management fee would be clearer and simpler for customers to understand.
It will apply to Royal London Unit Trust Managers multi-asset, equity and bond funds. Transaction costs will continue to be disclosed separately.
Rob Williams, chief distribution officer at RLAM, said: "Our customers want a better understanding of the cost of managing their funds, and the new fixed FMF does that - it provides them with both clarity and certainty.
"We will continue to monitor the fee levels to ensure our funds remain competitively priced while still providing excellent value for money."
The move follows those made by Fidelity and Allianz, which amended their charging structures last year.
The companies stated their changes better aligned with customers’ interests and meant fees only increase when there is demonstrable outperformance.
RLAM stated most investors would see their fees go up as a result of the change as the new rates have been set by taking asset size and future cost expectations into account.
However, the company stated the funds still remained amongst the lowest priced within their sectors.
Ryan Hughes and Simon Molica from the funds team at AJ Bell said any clarity and certainty surrounding fees was a positive.
They said: "It is however disappointing that the fees will see a slight increase across their range of funds when the direction of travel should be downwards, although we do acknowledge that they remain broadly competitive."
Rob Morgan, senior analyst at Charles Stanley, said the move could be positive.
Mr Morgan said: "Anything that makes costs easier to understand for consumers is commendable and a step in the right direction. It provides some certainty for investors in terms of costs, at least in the shorter term."
He said the funds were competitively priced against peers and the structure provided some reassurance that fees would not rise if the fund shrank.
He added: "However, the reverse is also true and further growth in assets will not automatically mean that economies of scale are passed on as they would be without a fixed fee.
"The annual review process will presumably be aimed at addressing this to ensure the level is appropriate."
Darius McDermott, managing director of Chelsea Financial Services, said: "Broadly this is good news for investors. Firstly they are simplifying their charge so there is one easier to understand charge.
"Under the new charging structure there is one fee, the fund management fee, which replaces the OCF.
"In lots of cases the costs are going down which of course is to be applauded. In a few cases there is a slight increase which is a shame."
