Tech could make or break advice businesses
Over half of financial planners believe advice businesses with outdated technology will not survive due to the volume of regulatory change, according to a survey.
The survey by CoreData, presented at a Financial Planning Association (FPA) event, found 88% of planners believed COVID-19 demonstrated to their value and two-thirds thought it would widen the advice gap.
The FPA said electronic disclosures and transactions provided more flexibility for consumers in how they engaged with financial advice and the ability for planners to provide better services to clients.
FPA chief executive, Dante De Gori, said: “The FPA has recommended the government works with the profession to improve the take up and effectiveness of electronic methods of disclosure, consent and transactions, including through standardised processes and forms and, where appropriate, by requiring the profession and financial services industry to provide electronic options.
“Financial planners are keenly aware of the importance of technology and the benefits it can bring to their businesses.
“The volume of regulatory change that is coming through means that it is becoming virtually impossible to do business as a financial planner using old systems and old ways of operating. There are clear signs that digital advice is gaining momentum due to the rising cost of providing advice and changing consumer behaviour.”
De Gori noted FPA members said delivering financial advice profitably was the single biggest risk facing the performance of their business this year. The planners said their greatest concerns were the growing burden of administration and compliance, and the rising cost of doing business.
“Streamlining regulation is essential, so too is effective use of technology, if we are to have a sustainable profession and give greater access to advice for more Australians,” he said.
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