The Quality of Advice Review’s inclusion of technology uptake in its terms of reference is an encouraging step, according to Ignition Advice, and reflects a maturing of the industry.
The terms of reference for the industry review were published last week and included descriptions about enabling innovation in technology solutions including regulatory technology and digital advice especially to engage a younger audience.
“The Review should pay particular attention to how technology and digital advice might enable mass market adoption of low-cost advice, particularly by young consumers, those with low asset values and consumers who do not currently engage with the advice industry,” it stated.
Speaking to Money Management, Craig Keary, chief executive for Asia Pacific, said: “I am encouraged by the acceptance of technology as a solution, the industry and Government thinking has matured in that sense.
“There is greater industry engagement in solving the advice gap, people are thinking about what can be changed in the future and there is acceptance that we have to lower the cost of advice to make it more accessible.”
Regarding using technology to engage with younger consumers, he said technology could be used to “lay down the train tracks” for working with that demographic at an early stage rather than waiting until the intergenerational wealth transfer had taken place.
“Advisers need to engage with the younger generation, and they need to do so now and pivot their businesses or they won’t be relevant in the future,” he said.
“This could be using technology to do a financial assessment covering debt, savings, superannuation as they are confused by their finances. This would then lay down the train tracks for future advice and bring them on that journey. As their wealth then grows or they come into an inheritance, then the adviser already has a stable relationship with them.”