Speaking to ifa, Decimal chief executive Nic Pollock said he understands some of the negative industry attitudes towards robo-advice, like ANZ’s recent comments that robo-advice is not a “meaningful” investment for the bank.
“You may think it’s crazy, but I agree,” he said.
“Obviously Decimal plays in the robo-advice space. Robo-advice is becoming quite limited. Robo-advisers are trying to disrupt but what they’re really doing is using the internet as a delivery channel for financial products, not financial advice.
“There is much much more to digital advice than this. It’s about how we engage with customers more and, on a broader basis, with all the financial topics that they would want to discuss at each different point in their life.
“If I’m ANZ, I want to keep that customer from the time they get their first account, their first home loan, car loan, through marriage, through growing a family, insurance needs, putting a kid through school – that’s what these organisations need to be addressing.
“It shouldn’t be about disruption. It’s about enabling.”
Mr Pollock said robo-advice platforms need to be compliant, offer scalability and need to connect with other business systems to streamline customer information.
“The obvious challenge on a lot of people’s minds, not least of which is ASIC, is compliance. We’re all very keen on being customer centric, but it doesn’t matter how creative and wonderful the customer experience is – if it’s not compliant it all goes downhill,” he said.
Mr Pollock said Decimal is seeing the robo-advice market shift from education to execution.
“We don’t need to have any more conversations about how digital advice and robo-advice are affecting businesses and why they’re important. We’re past that now and looking at the effective implementation and running of platforms,” he said.
According to Mr Pollock, Decimal plans to announce the release of new product offerings early in the new year.
The most meaningful contribution the government can make is to legislate what advice is and to create a level playing field for compliance of advice. The concepts of limited/intra fund and robo advice are far too grey for customers to understand and these terms are then used as marketing tools to create a false perception, and worse still enables the provides to escape the compliance requirements for the advice they are positioning. They are trying to have it both ways – on the one hand saying to the regulators that we are not providing advice and therefore we should be exempt from advice compliance and from a marketing point of view they are positioning themselves as providing advice. Uber have made it pretty clear that their strategy is to manipulate legislation to suit their business model. If the regulators are serious about consumer protection they must see through this manipulation and stand firm on a definition of advice.