Speaking at the ASFA Conference in Adelaide, Matt Lawler, managing director of advice at AMP, said the firm is looking to launch its digital advice tool in the new year.
Mr Lawler said, “2023 has for us been about understanding the market. We did a bit of work with KPMG earlier in the year and we’ve been researching and having all of the providers present. We are getting closer to choosing one of those providers to move forward and I think it’ll be a 2024 release for us”.
The digital offering aims to assist advisers in catering to a wider spectrum of clients, particularly those seeking enhanced affordability, but it will also be tailored to AMP’s superannuation fund side of the business.
Asked about AMP’s approach to charging for its digital advice, Mr Lawler explained that funding for the super fund aspect will be sourced from the fund itself. On the advisory side, the tool is designed to guide clients towards comprehensive advice, allowing advisers to charge for their services.
“They [advisers] still have 100 to 200 clients who are what we call nurtured clients. They might be younger clients who got a little bit of advice, but then they’re not on an ongoing fee program. But the digital advice tool can nurture them until they’re ready for that fuller advice relationship,” Mr Lawler explained.
Earlier this year, AMP’s Digital Financial Advice Market Scan found that there has been a surge of interest in financial advice solutions, with a wide range of entities, including superannuation funds, insurers, banks, asset managers, platform providers, and financial planning firms, exploring opportunities in this space.
The report, commissioned in partnership with KPMG and based on a survey of 16 digital providers, found that while enterprises had initially slowed their engagement with digital advice providers, the “flurry of activity” had been driven by several factors including the Quality of Advice Review (QAR) and declining adviser numbers.
According to the report, which, among others, surveyed abrdn, Ignition, Iress, Mercer, Midwinter, and moneyGPS, the industry is now eager to determine whether this increase in interest could actually translate into the successful adoption of digital solutions by enterprises and customers alike.
In announcing the report at the time, Mr Lawler said: “Practices have the same issues with cost to serve of financial advice as large institutions and superannuation funds, so supporting all players to provide a service that ‘nurtures’ clients along the advice spectrum is core to how we think about solutions in this space.
“Understanding the full spectrum of financial advice that clients are looking for and how face-to-face and digital advice interplays is critical. As is the support of fintechs seeking to solve these problems for the advice industry to provide simple and scalable solutions.
“I’m encouraged with the quality of the providers working to simplify the advice process for more Australians,” he concluded.
Good to see AMP go first. They will once again set a benchmark for what not to do.