Compliance obligations continued to be the top challenge faced by financial advisers and there is an opportunity for platforms and software providers to better support advisers in handling compliance obligations, according to a report.
Investment Trends’ latest ‘Adviser Technology Need Report’ found that compliance was the top challenge by 66% survey advisers (up from 64% in 2020), followed by the provision of affordable advice (51%), regulatory uncertainty (43%), and administration of fee disclosure statements (FDS) and client opt-in (30%).
The survey found the compliance-related tasks that advisers found most burdensome were file noting (52%) and data collection (48%) at the fact-find stage, and documenting ongoing service agreements (49%).
Investment Trends said when it came to managing client fee consent, which was also a significant challenge, advisers’ preferences were somewhat varied. While they most often preferred their planning software to manage this (38%), a large proportion prefer to do so on their platform (25%).
The research house’s senior analyst, Bailey Hao, said: “Advisers continue to grapple with compliance-related challenges that take up a significant amount of time, effort and cost. But across the various technologies and systems they use, advisers believe their advice planning software is best placed to help reduce their compliance burden.
“Throughout the entire advice process – from fact-find, to implementation of advice, through to ongoing client reviews – the planning software is most favoured to provide assistance, while investment platforms and [customer relationship management] CRM tools are only favoured to a small extent.”
Hao said there was an opportunity for platforms and software providers to better support advisers in handling compliance obligations such as client consent for ongoing fees.
“While advisers appreciate help through greater automation, technology providers must also recognise that they seek assistance in communicating and engaging with their clients,” Hao said.
Investment Trends also found that AdviserLogic was the highest rated advice software, and was most value for money. Xplan was rated most highly for production of comprehensive and simple financial plans.
