Have you ever dreamed of having a robo-assistant? Imagine a butler that talks like C3P0 with all the tools of Inspector Gadget! While the robots assisting financial advisors today may not be so cute, they are nevertheless proving to be extremely useful… especially when it comes to enhancing profitability. A striking 95% of advisors are even planning to buy more investment technology this year. And it’s easy to see why.
Here are five ways that tech solutions are empowering independent financial advisors (IFAs) into a brighter future:
1. Sweeping away most of the admin
One of the most impactful superpowers of robots is their ability to process vast swathes of data in mere seconds. A 5GHZ processor, for example, can analyse information 5 billion times in just one second.
Robotic Processing Automation (RPA) excels at completing mundane and repetitive tasks, like form-filling. This makes it an ideal assistant for all kinds of businesses. Four in five small and medium-sized firms, for example, agree that automation is “vital to manage financials on a day-to-day basis”, according to one 2023 study.
Digging deeper into the wealth management industry, we’ve found that robo-services reduce or improve workloads in a variety of ways. For example, the data collected can be used to complete onboarding in record times, provide personalised suggestions or offer helpful insights to advisors. A study focused on bankers found that they’re currently spending between 10 and 40 hours a week on Microsoft office tools that could be automated. Taking away this admin would be transformational.
2. Providing extra services like SIPPs, Junior SIPPs, ISAs or Junior ISAs
White label services are one of the cornerstones at Quai. In short, it means adding an extra service for clients digitally with little to no work for the managers. And it’s called “white label” so that firms can put their own branding over the product, and edit it as needed.
Some of the most popular white label services include Self-Invested Personal Pensions (SIPPs), Junior SIPPs, savings accounts, Individual Savings Accounts (ISAs) or Junior ISAs.
We’ve seen firsthand how these added extras help elevate investors from affluent to high net worth, increasing assets under management for the firm. They also broaden the product shelf, helping to retain clients, increase engagement, as well as freeing-up the time and expertise of managers.
3. Reducing costs – for both IFAs and clients
One of the major hurdles IFAs need to overcome in today’s world, is the high cost of wealth management. Almost half (47%) of non-advised investors think that a financial advisor would be too expensive for them.
By taking away menial and repetitive tasks, robots can free-up resources across the entire firm. For example, advanced regulation technology services are increasingly rescuing compliance departments from otherwise insurmountable workloads. This creates cost efficiencies for both the advisors and clients.
But robo-assistance doesn’t just save money for firms, it can also bring in increase profit margins, for example with useful data. Nine in ten institutional investors believe that technology leads to better returns and more profitability. As average industry profitability slimmed by a further 10% in 2023, to just 32%, there isn’t a moment to lose.
4. Robo-administration increases happiness and productivity for wealth managers
It’s already well established that RPA can unshackle managers from menial administrative labour. But digging a little deeper, we can see how this elevates the whole firm culture too. Almost a quarter (24%) of managers with automated investment operations report higher levels of both happiness and productivity. This can have a knock-on effect throughout the firm, making for a happier and more loyal workforce.
On the other hand, firms that do not embrace automation stand to lose employees. One study found that the average banker suffers through between 10 and 40 hours a week manually doing tasks on Microsoft Office, even though 90% want this to be automated instead.
In a world where 72% of investment bankers are wrestling with the decision about whether or not to leave the industry due to stress, automation is a low-hanging fruit for firms to keep valuable members.
5. Keeping pace with competition
Along the same lines, robot assistance can help to make firms more competitive too. After all, customers could be attracted to cost savings, seamless digital experiences and a strong suite of (white label) products to choose from.
Today an estimated 20% of affluent millennials have opted for robo-advisors over IFAs. Clients, including HNW individuals, want and expect a seamless 24/7 online service. They already experience this daily with personalised suggestions on streaming services, round-the-clock food and grocery delivery with apps like Uber and on-demand account services with neo banks. To stay relevant IFAs must offer this too, which can only be done with technology.
Staying relevant with technology
Every Batman needs a trusty Robin, and for IFAs that loyal sidekick could be a robot. After all, it helps them achieve all their missions without getting in the way.
The adoption rate is low today. For example, just 6% of IFAs use AI to help them prospect clients. However, over nine in ten (95% )of UK advisors aim to invest more in technology this year. Added to this, almost half plan to change the platform they’re currently using. Getting ahead now is the best way to start benefitting and avoid getting left behind.
Interested in finding out more?
If you’d like a no-strings attached consultation about how your firm can benefit from white-label and investment operation services, we are just a few clicks away.
