According to global software technology firm Backbase’s regional sales director Jeremy Thomas, next-generation technology such as AI can help free up a financial adviser’s time to deliver a better service to clients – something that is increasingly vital given the strain to meet the demands of an underserved market with the number of advisers still in the profession.
“To say the past few years have been challenging ones for the Australian financial advice profession is an extraordinary understatement,” Thomas said.
“In the wake of the banking royal commission to investigate misconduct in the banking, superannuation and financial services sectors, the industry was subject to a series of extraordinary reforms, all aimed at weeding out dodgy practices and restoring trust in the system.
“The reforms included the elimination of conflicts of interest in the provision of advice – a development which saw several major institutions exit the market – minimum education standards and, more latterly, a requirement for financial advisers who provide personal advice to retail clients on relevant financial products to be registered with ASIC.”
The financial adviser population has, as Thomas put it, “shrunk considerably”.
According to the most recent Wealth Data figures, as of 9 January 2025, there are 15,481 financial advisers registered with the Australian Securities and Investments Commission (ASIC) – a far cry from the roughly 28,000 before the royal commission.
“Advisers who have stayed the course face a series of challenges in their quest to deliver a quality service to Australians committed to making the most of their money,” Thomas said.
“Chief among these are time constraints. Juggling numerous clients, each with their own unique needs and aspirations, means less time for crucial tasks such as in-depth research, strategic planning and personalised communication.”
Also playing a role, he said, is the sheer volume of information that is overloading all aspects of the digital era, with the amount of financial data and commentary available becoming “overwhelming” for advice professionals, let alone consumers.
“Sifting through it to extract meaningful insights that can be used to make informed decisions is a Sisyphean task but one which advisers are required to tackle on a regular basis,” Thomas added.
“Regulatory requirements too, are – quite rightly – much more rigorous than once they were. As well as having an approved qualification and passing the financial adviser exam, registered advisers must participate in 40 hours of continuing professional development each year.”
He argued that even more demanding for advisers is meeting client expectations, given the significant investment involved in receiving advice, regardless of its scale.
“Many are well informed, invested in the process, technologically savvy and keen to see value for the four and five figures sums being laid out. Providing personalised, proactive advice and seamless communication is a must for advisers who seek to build trusting relationships and long-term loyalty,” Thomas said.
This, he added, is where a range of AI-powered tools come in, from virtual assistants and chatbots delivering instant answers to basic enquiries and requests for information to analytics tools that conduct sentiment analyses and generate insights into clients’ short and long-term needs.
These AI-driven additions to an advice practice can free advisers up to “focus on higher level engagements for which human input is essential”, Thomas said, while also enabling empathetic, personalised service and support.
“While it can’t replace human advisers, artificial intelligence can help them tackle many of the demands of their role, in both the front and back offices,” he said.
This extends to investment, AI-driven models that are trained on massive datasets able to support advisers to identify patterns in market data, manage asset allocation and mitigate risks.
“Harnessing the power of this technology can make it easier to create and manage an optimal investment portfolio for every client, and to rebalance it in real time, as circumstances and market conditions change,” Thomas said.
“AI can also be used to automate compliance tasks that absorb time which could be better spent on higher-value activities.”
Pointing to another consistent issue for advisers – dealing with onerous red tape and regulatory obligations – he pushed the need to engage with the right tools.
“Composable, pre-integrated customer experience capabilities and out-of-the-box journeys can enable financial advisers to deliver exceptional customer experiences efficiently and cost effectively, at scale,” Thomas said.
Recent Praemium research found that up to 80 per cent of advice firms could be utilising AI in 2025.
Its AI & Integrations report found that 39 per cent of advisers are already using AI in their work, with a further 38 per cent stating intentions to incorporate this technology over the coming year.
The technology could also help enable “hyper-personalistion” for advice clients, according to Capgemini, with the firm finding that more than 64 per cent of high-net-worth investors are concerned by the lack of personalised advice tailored to their financial situation.
Meanwhile, appearing on an IMAP podcast, Marin Wealth managing director Pedro Marin Ramirez explained that his firm is currently using AI to assist in writing proposals, letters of engagement and file notes, reducing the administrative burden and freeing up advisers’ time.
“We are able, instead of what used to take me probably 45 minutes to write an actual file note, it takes around maybe two to three minutes. So, the efficiencies are there,” Ramirez said.
He added: “I think technology will help us massively scale up. So, I would consider 200–250 clients per adviser will be the norm because of how easy it would be for us to trade, how easy it will be for us to engage.”
Somehow this article seems to say nothing at all… just me?
Probably written by an AI bot