Consumer trust isn’t something to be taken for granted, but reports from the UK, US and here at home are all pointing towards an uplift in trust levels around financial advice, which can only be a welcome development.
There are significant tailwinds behind the financial advice industry at the moment, but some major obstacles are still preventing advice practices from taking advantage of surging demand according to a new study from CFS.
Financial advisers call for integrated technology solution as platform satisfaction wanes
New research has found that advisers are struggling with cumbersome wealth platforms that are causing significant time delays and errors. The industry is now calling for an integrated technology solution that reduces administrative burden and lowers financial costs.
The Investment Trends 2022 Adviser technology needs report found that “compliance burden (65 per cent), the ability to provide affordable advice (41 per cent), and regulatory change (40 per cent)”, were among the main challenges facing advisers.
As advisers turned to their wealth platforms for support, the report found that many were using “multiple technology solutions to support them, including client relationship management systems (CRMs) and standalone modelling tools”.
The report also uncovered the use of multiple platforms was being done without any integration, leading to time consuming inefficiencies, and costly errors.
“The use of multiple platforms has reached a 10-year record high average of 3, with advisers increasing the proportion of new business directed to their secondary platform at the expense of their main platform,” the report highlighted.
Advisers are desperately looking for an end-to-end solution that supports their ongoing compliance requirements and integrates all their services into one. The industry is calling for a greater need for integration between the systems they use.
“Advisers face significant delays regarding the implementation of their advice, in a process often prone to errors,” the report highlighted. “Two-thirds of advisers say they would use an end-to-end solution to minimise the delays and errors currently occurring between advice delivery and implementation.”
According to the research, advisers are looking to increase their practice’s current annual spend on technology from the current estimated average of A$146,000 to A$216,000.
“It’s assuring to see advisers’ rising adoption in technology solutions and intentions to increase annual spend on these solutions going forward, making the advice preparation and implementation process more streamlined and effective,” commented Dougal Guild, research director at Investment Trends.
The overall adviser satisfaction with platforms has declined (67 per cent, down from 72 per cent in 2021). The research report also found that the lack of support was the number one reason for client attrition.
“In this highly competitive market, it is imperative that platforms are listening to the needs of advisers. With fees and capabilities becoming more consistent across providers, advisers are placing an increasing focus on platform reliability and quality of service support,” Guild added.
