Forget Hayne, here’s four ways technology will remake financial advice
Technology’s waves have swamped plenty of other industries, so it’s hardly a surprise they are washing over the provision of financial advice. So much so, there’s talk of yet another “-tech”: as in, AdviceTech.
So what’s accelerating the pace of digitisation of financial advice? Four key themes come to mind:
First, providers realise the current advice offering does not resonate with customers. It’s a poor “experience”. Stats suggest only one in five Australians gets financial advice.
Second, the royal commission into financial services has made it abundantly clear the dominant advice model has too many conflicts of interest.
Regardless of whether the inquiry separates product manufacture from providing advice, it feels the future will be defined by platforms and customer choice, not vertical integration and corporate control.
Third, ironically, is the exit of big banks from manufacturing wealth products. NAB will sell MLC; CBA will split out Colonial; ANZ has already sold OnePath to IOOF.
These deals, combined with AMP’s Hayne-inflicted woes, are creating opportunities for new brands to step up, and the impetus for existing distribution models to be reimagined.
Last, and probably most powerfully, is the trend towards liberation of customer data.
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