By incorporating a robo-advice tool into their practice, advisers will be able to grow their client base by serving a new cohort of clients like millennials, says clover.com.au.
Harry Chemay, chief executive of robo-advice platform clover.com.au, said that by incorporating a robo-advice tool into their practice, advisers can service more clients without it being “cost prohibitive”.
“There’s no real way that younger Australians and people with less money can get high-quality advice, particularly from independently minded advisers, because [the advisers] can’t provide a solution at a cost that is bearable,” Mr Chemay told Adviser Innovation.
Mr Chemay pointed out that robo-advice removes the cost associated with the human element of providing advice. For advisers who offer an automated tool, it allows them to grow their client base, but at a fraction of the cost.
“Younger Australians feel that they have something available to them, and by the same token, advisers feel that there is a way to build a nursery for younger clients who will become full advice clients at some point in time,” he said.
Moreover, Mr Chemay believes that ultimately, robo-advice and human advice will “blend together” to form a “hybrid” advice model.
Looking out over the next six to 12 months, he argued that a greater number of robo-advice platforms will be operating within the Australian marketplace.
“This time next year there will be a number of start-ups, like us, out there in the marketplace but there will very likely also be a few offerings from the large institutions like the big banks.”
He said the take-up of robo-advice by institutions will place additional pressure on advisers to adopt some kind of automated advice tool.
“The question will be: do [advisers] build [their] own or do [they] outsource it and look for some sort of white label solution?”