Expect JVs as advisers embrace technology

Financial advisers could form joint ventures with technology firms in the future, according to EY, if they want to service clients of the next generation.

Speaking to Money Management, Rita Da Silva, Oceania wealth and asset management leader at EY, said awareness of financial advice had “escalated” during the pandemic but that there remained a problem regarding people being able to access it.

Referencing the option of robo advice as a solution, she said: “There needs to be an evolution but investment in developing this type of technology is very expensive. Given most of it is focused on exchange traded funds so far, the gap is there for active managers to harness that opportunity.

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“To get client-centric solutions, firms will need a joint venture with other firms in that ecology. This could be platforms, it could be technology firms which develop a ‘white label’ solution to use, we have already seen this happen offshore where firms are partnering with those which have developed a solution.”

She said it would be “highly important” for advisers to embrace technology in order to deal with the next generation of clients as they had been digitally savvy for most of their lives and would expect a similar service from their adviser.

“This year had enhanced the need for digital transformation and that’s accelerated robo advice being used by the broader population,” Da Silva said.

“Most apps provide only general advice whereas advisers provide personal advice, in an ideal world, we would have a hybrid model as people do generally need access to a person. There needs to be a way for advisers to capitalise on the trend especially as people grow their wealth but it is on the adviser to promote their benefits and capabilities to the consumer.”




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