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Financial advice industry poised for ‘significant digital transformation’

The financial services sector is poised for a “significant digital transformation” according to a new paper.

Ignition Advice and UK-based Altus Consulting have joined forces to produce a white paper, “Reimagining financial advice”, which looks at the future of digital advice where “technology is enhancing rather than replacing the work of financial advisers”.

One of the key themes dealt with in the paper is robo-advice failing to make a dent in the advice space in the UK, which proved to be a similar case in Australia, as well as the massive impact of the COVID-19 pandemic that understandably forced businesses and practices to move online and embrace technology.

The paper suggests many financial planning practices “adopt crisis mode” in keeping their businesses afloat despite “economic uncertainty and considerable investor nervousness”.

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However, it predicts that the digital adoption driven by the pandemic has the potential to be a catalyst for fundamental change in the sector.

“Advisers have proved themselves to be resilient and quick at adapting to fit their customers’ needs,” intelliflo chief executive Nick Eatock said.

“Technology has made the last year easier, with businesses being able to quickly move to the virtual world. In doing so, advisers are finding greater efficiencies and new uses of technology that are helping their business grow.”

Altus Consulting’s Sam Turner concluded that the attitudes to the use of digital have shifted since COVID and can now enhance the advice process.

“This leaves the advice industry poised for a significant digital transformation,” Mr Turner said.

“Banks, life companies and smaller propositions have developed or are introducing hybrid advice models, while the suppliers of digital advice software solutions are refining their configuration and implementation models to enable swift, flexible delivery.

“We expect the adoption of B2B digital advice solutions to enrich, rather than replace, the traditional advice process to notably accelerate over the next five years.”

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Financial advice industry poised for ‘significant digital transformation’
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