The advice industry is poised for a significant digital transformation – new digital capabilities, including advice technology, will disrupt the traditional advice model, but not in the way originally envisaged.
The pandemic and the accompanying social distancing measures have forced many to rely on technology more than ever before. In some areas, this overnight change has provided a much-needed impetus to encourage businesses to re-think old habits and provide what is actually a better consumer experience.
According to a new whitepaper examining how the financial advice process will be enhanced using new digital capabilities, digital will enrich the skills of the advisers, not replace them.
In the paper, advice technology provider Ignition, together with financial services consultancy firm Altus Consulting, offer recommendations on how the UK market can reduce the advice gap and draws on the lessons learned from the wider economy over the past 15 months.
Altus research shows that adviser spending on technology is increasing across the board, but spending in a cost efficient manner can prove difficult. The paper highlights:
- Banks, life companies and smaller propositions have developed or are introducing hybrid advice models
- Suppliers of digital advice software solutions are refining their configuration and implementation models to enable swift, flexible delivery
- The adoption of B2B digital advice solutions will enrich, rather than replace, the traditional advice process to notably accelerate over the next five years.
Terry Donohoe, CEO Europe, Ignition, said: “We have seen that there is real demand in the UK financial services market for true digital advice, which seamlessly combines technology and human expertise to provide an easy-to-use service that helps customers make better financial decisions.
“As our whitepaper shows, there are still significant hurdles to clear before this model becomes the norm, but we are now closer than ever to revolutionising the advice industry and closing the advice gap.”
Sam Turner, consultant at Altus Consulting, adds: “Initial hype around so-called ‘robo advice’ seems to have cooled and the industry is now turning towards a more hybrid model, which works in various forms to combine digital tools and human expertise.”