Digital advice association moving forward

Speaking on the ifa show podcast, moneyGPS chief executive officer George Haramis said the government’s response to the Quality of Advice Review (QAR) final report has not held back the progress of the association.

“The association is going ahead. The government’s, not so much delay, but cherry picking of the Quality of Advice Review recommendations hasn’t hindered that,” Mr Haramis said.

“If anything, it’s made it more of an imperative because unfortunately, the government didn’t agree to all of the recommendations, so for some players, it makes it more difficult to get into the digital advice space, as you’ve seen with abrdn’s comments over the past couple of months.

“We’re very much looking to getting the association up and running very shortly.”

However, he did note that the government’s omission of the good advice duty from its plans, to date, is detrimental to the provision of advice to a larger number of clients.

“Adopting the good advice principle would have made it a lot easier to deliver person advice. From the recommendations made by Michelle Levy, it just would have been fit for purpose for many people who can’t afford traditional advice or their circumstances don’t need a traditional advice approach,” Mr Haramis said.

“So, they need advice for a particular issue at a particular point in time. Good advice would have been the perfect solution. Unfortunately, it hasn’t been adopted as yet and I hope to see the government review that decision in the future.”

In April, fund manager abrdn, along with fintech firms Ignition Advice, moneyGPS, and Advice Intelligence, announced that they were finalising the formalities to establish the Australian Digital Advice Association (ADAA), aimed at advocating for change in financial advice regulation and improving the delivery of digital advice solutions.

At the time, Mr Haramis told ifa that the consortium’s founders share the belief that affordable personal financial advice should be accessible to all Australians.

“Our aim is to engage government and key industry players to ensure we all work together to assist Australians have greater access to affordable advice,” Mr Haramis said.

He explained that digital advice is already a “mainstream player” and should be viewed as an “adviser’s best friend” for a variety of reasons.

The ADAA took a hit when Advice Intelligence announced it had entered voluntary administration following the decision from its investor, Regal Funds Management, to withdraw future funding.

However, things improved in July when global fintech business GBST announced its acquisition of Advice Intelligence.