BNY Pershing, Goldman Ayco's Referral Push: A Tactical Mispricing Play?

The catalyst is a new, crowded market. Goldman Sachs Ayco has already launched its referral program, signing on mega-RIAs Mercer Advisors and Wealth Enhancement as initial partners earlier this month. BNY Pershing's competing 'Advisor Match Service' is scheduled to launch later this year, putting up one or two advisor referrals per request based on custodian criteria according to the company and a regulatory filing. Both operate on a fee-for-service model where RIAs pay Goldman Sachs Ayco a percentage of advisory fees on referred assets which are paid each year the client stays at the RIA.

This creates a tactical challenge to Schwab and Fidelity's long-standing duopoly in the RIA referral space. The immediate setup is a crowded field, with BNY Pershing, Betterment, Altruist, and Robinhood all forecasting similar programs have all forecast starting advisor client referral programs. For RIAs, the choice is no longer just between two established partners but now includes a wave of new entrants.

The thesis is that this crowded entry is a high-risk, high-effort play that may be mispriced by the market. The fee structure itself is a significant friction. Mercer and Wealth Enhancement pay Fidelity a 0.10% fee on fixed income assets and 0.25% on all others, in addition to a $50,000 annual participation fee Those fees, which are paid each year the client stays at the RIA. That's a direct, ongoing cost for every referred client. For a new program to attract RIAs, it must offer a compelling value proposition that justifies adding another layer of fees on top of existing relationships. The market may be overestimating the ease of capturing share from entrenched players, underestimating the cost of acquisition for RIAs, and overlooking the sheer number of competitors now vying for the same limited pool of referrals.

The Mechanics: The Cost of Entry and Niche Targeting

The financial mechanics of this new referral wave are straightforward but create a clear cost for RIAs. For Mercer and Wealth Enhancement, joining Goldman Sachs Ayco's program means adding another layer of fees to their client acquisition model. They already pay Fidelity a 0.10% fee on fixed income assets and 0.25% on all others, plus a $50,000 annual WAS participation fee. Now, they are paying Goldman Sachs Ayco for referrals from its executive counseling division, which serves corporate executives. This is a direct, ongoing cost for every referred client they keep.

For BNY Pershing, the structure is similar but targets a different slice of the market. Its upcoming Advisor Match Service will require participating RIAs to pay an annual $50,000 participation fee and an annual asset-based fee of up to 0.30%. The key difference is the niche. Goldman Sachs Ayco's referrals come from its executive financial consulting relationships with Fortune 500 companies, targeting complex, high-net-worth clients. BNY Pershing's program is for its broader wealth manager clients, which may attract a wider but potentially less specialized pool.

The bottom line is that this crowded field forces RIAs to pay more just to access more referral leads. They are essentially paying for the privilege of being considered for clients who are already being referred through established, lower-cost networks. The market may be overlooking this friction. For a new program to succeed, it must offer a value proposition so compelling that RIAs are willing to shoulder this added expense. The fee structure itself is a significant barrier to entry, one that could limit the speed and scale of adoption across the RIA landscape.

The Setup: Valuation Impact and Near-Term Catalysts

For Goldman Sachs, this is a low-overhead revenue play. The Ayco referral program leverages its existing client base of corporate executives to generate new fee income without the direct RIA overhead of building a custodial platform. The risk is alienation. Mercer and Wealth Enhancement are existing members of Schwab and Fidelity's referral programs, which pay fees to those custodians. By adding another layer of fees on top, Goldman Sachs risks straining those relationships. The market may be underestimating this friction, treating the new program as a pure incremental revenue stream rather than a potential disruptor to its own custodial partnerships.

For BNY Pershing, the move is defensive. Its program is a direct response to Schwab and Fidelity's duopoly, aimed at retaining wealth manager clients against a wave of new competition. The late 2025 pilot suggests a slow build, which is a key constraint. The official launch of the Advisor Match Service is scheduled for later this year, which will test the program's uptake against entrenched competition. The slow rollout is a double-edged sword: it allows for refinement but also gives Schwab and Fidelity more time to solidify their positions and potentially lock in more partners.

The key near-term catalyst is that official launch. It will provide the first real data point on whether RIAs are willing to pay the added fees for another referral channel. Given the crowded field and the existing fee structures with Schwab and Fidelity, the bar is high. The event creates a tactical mispricing opportunity if the market overestimates the speed and scale of adoption. The launch will separate the defensive play from a genuine growth catalyst.