Financial advice firms should be more concerned about the rise in popularity of digital advice platforms as they gain popularity and capabilities, data and analytics company GlobalData has said.
The researcher’s 2018 Independent Financial Adviser (IFA) Survey in the UK found a small minority (6.3 per cent) of IFAs are concerned about client-facing robo-advice from tech or apps entering their space.
However, UK fintech Wealth Wizards has launched what GlobalData is calling a step up from prior robo-advice: MyEva, a fully regulated, digital IFA platform available through employers and open to the public.
The product is said to comprise a web app with chatbot abilities, and is designed to guide users through a financial health check, before offering personalised recommendations for long-term investments and savings along with other services.
Pricing differs for each level of service, but there is also a free option.
MyEva offers personalised advice instead of automated investment options, a disruption to the current landscape where higher fees for advice may see consumers settle for robo-advice.
Sergel Woldemichael, wealth management analyst at GlobalData said IFAs cannot be oblivious toward innovation.
“Both our Mass Affluent and Global Wealth Manager surveys show strong appetite for digital services with access to a human adviser, especially among younger generations,” Mr Woldemichael said.
“With offers such as robo-advisers robo-advisers disrupting the investment industry, it was a matter of time before the financial advice sector was disrupted. Digital IFAs are only in the early stages of market adoption and so are unlikely to fade away anytime soon.
“Technology in the wealth industry has once again opened doors for the masses to receive advice and investment management. Innovations such as digital IFAs are inevitable and although they are unlikely to completely take over the industry, they will appeal to cost-conscious customers.”
Within 24 hours of MyEva’s launch, rival UK fintech Multiply told the market it would releasing its own digital IFA.
In addition to traditional advisers being disrupted, other robo-advisers will also have to pay attention and step up their game, Mr Woldemichael added.
”The recent launch of MyEva, an independent advice platform, will add an additional layer of competition to the UK’s already crowded advice market.
“With a new kid on the block, robo-advisers will have to up their game and pay greater attention to the advice component.”
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