Technology has become a vital part of the financial planning process especially with the business change imposed by Covid-19.
But the advice sector is set for the next tech evolution.
Terry Donohoe, chief executive of Europe at fintech firm Ignition Advice, told our sister publication, International Adviser, that the hybrid advice model is what the sector is heading towards.
He said: “I think that’s the next evolution in this industry. I can’t think of many industries where you’ve gone from a manual process to a fully automated process and not on something in the middle.
“Globally that is what the financial advice landscape looks like, you have gone from manual to robo and there’s nothing pulling that all together in the middle.
“I think it’s the obvious next step but getting the advisers comfortable is really key. What you’re doing is you’re giving them more time back to help serve more customers and focus on strategy, not collecting data or collecting facts that can be automated for the most part. It’s just the face-to-face contact.
“Robo hasn’t seen the mass uptake that was probably expected because the adviser isn’t in the middle at the important bit. It’s critically important.”
In February 2021, IA reported that Sydney-headquartered Ignition Advice had moved into the UK market, establishing teams in London and Edinburgh after gaining a European presence in Dublin in 2017.
At the time, the firm said that it looked “forward to bringing the UK market live digital advice solutions for insurance, pensions and wealth in 2021”.
Donohoe added: “We made a strategic pivot about four years ago that focused on how to close the advice gap globally and what was the best way to tackle that rather than trying to do it ourselves as a robo.
“What we found was partnering with institutions and providing digital advice solutions through them that this was the best and fastest way to actually provide those services out the back end and hit the mass market.
“All jurisdictions are having the same advice gap challenge, it’s no different in Australia or UK, it’s all the same.
“We had the real benefit of getting to work with a tier-one bank in Ireland. When the guys asked me to come in on board, it allowed us to actually start from scratch, build a platform from the ground up, rather than actually use some legacy systems.
“When you design like that, you’re actually building for speed of implementation, configuration, things that actually help get you to a point. The very natural next step then is the UK market. It’s natural because of the language and the geography. But in actual fact, it’s probably one of the most advanced financial services marketplaces in the world as well.
“This is a good testbed. The opportunity in the UK, the institutions, the advice networks that are going on probably trumps most other jurisdictions globally.”
Ignition Advice is looking to take on the likes of Wealth Wizards and Investcloud in the financial planning solution market.
So, what is the UK market missing?
“The industry is probably so far ahead of everybody else, it’s probably not what they’re missing,” Donohoe added. “They have a lot of what is out there, but they’re not connected.
“How do you connect these up? How do you create a seamless experience when you have a separate product engine, fulfilment engine, CRM system, client, portal and bank app?
“If we’re doing it from an engineering perspective, you’d use an API or something like that. There is no other advice platform that sits in the middle to pull all of that together and orchestrate how advice is delivered. It’s just how you connect it all.”
Donohoe said that the firm’s success in the UK will “absolutely determine how successful we are in the rest of the world”.
“If we want to be the leading advice platform to institutions globally, we’ve got to do that in the UK,” he added. “We’ve got to be the leading player in the digital advice marketplace.
“It’s still relatively new. We would hope to be in some way supporting most of the leading advice firms within the UK within the next few years.”