Few technology shifts turn out to be big one-off developments that supersede everything that went before them. Many are fairly mundane day-to-day affairs that slowly integrate themselves into our lives. Robo-advice has picked up plenty of news coverage in recent years, but we see other technology trends across the advice market that are having a significantly greater impact on the delivery of advice.
There’s high demand for face-to-face financial advice from investors. The trouble is that there is a shortage of supply. At the same time, the regulator is pushing advisers towards more regimented processes and recording of how decisions are made (like those maths teachers who give zero marks for correct answers unless they’ve seen the workings!). So, advisers are increasingly turning to technology to make their advice processes more efficient, more consistent and better documented.
Third-party technology solutions are becoming an integral part of the advice process for more and more advisers. Risk profiling tools are already widespread, cash flow modelling is becoming increasingly common and advisers are starting to look at using technology to support fact-finding, especially with the advent of open banking. With better integration between these systems, the much-needed increase in productivity would be even greater.
But advisers continue to be wary of automating the advice element. A human adviser can take on board an investor’s emotional goals and map them onto suitable solutions – something we’re still a long way from automating. But we are seeing technology take over some of the more mechanical elements of providing advice, helping advisers be more effective and efficient and get on with the business of advising.
Our final Platforum report of 2018, Adviser Market: Fintech and Digital, will be published next month, covering how advisers are using technology in the advice process and their businesses in general. Get in touch with firstname.lastname@example.org for more information.