In a new report, titled The evolution of the fintech boom and how you can be a part of it, Netwealth concluded that not many Australians are willing to pay $4,500 to $5,000 per annum for financial advice, which is the standard fee.
“The perception is that these prices mean that advice is only available to a few,” the report stated.
“To reach the mass market, either the industry needs to do a much better job of educating the masses as to the value of advice or lower its prices. Maybe it needs to do both.”
Netwealth said advisers can achieve this by partnering with fintech companies.
“The key for financial advisers is to partner with fintech companies that have the ability to digitise the advice process and develop their own consistent advice model that is in line with regulatory requirements,” the report stated.
“Fintech will play a major role in allowing the industry to provide an advice service at a cheaper cost while maintaining the expected level of compliance. The way an adviser goes about doing a review of a client or a plan today is time consuming.
“Fintech providers are already looking to address this inefficient process with improvements in financial planning software. Robo and scaled advice solutions aim to reduce the time it takes to create and sign-off a statement of financial advice from weeks to a single session.”
Netwealth added that fintech also offers the industry the opportunity to provide new forms of advice.
“Never before have cash flow and budgeting tools been so readily available,” the report stated.
“It is now possible to work with your customers to monitor their financial accounts and learn about their purchasing habits so as to coach the person on their spending and saving behaviours.”
