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Artificial Intelligence first becomes the new normal in financial advice

This week I am in New York for the opportunity to see the very latest wealth technology innovations and to hear from several of the industry leaders who are transforming the way Americans access financial advice.  Now in its third year, the In|Vest conference provides a heady mix of powerful tech demonstrations and exceptional thought leadership.

For me the big message on day one of the show was machine learning and artificial intelligence is now part of the emerging landscape. In what follows I will highlight some of the early leaders. The volume of these offerings on display makes me feel the US may again be pulling ahead of the UK in FinTech and especially WealthTech.

After a brief opening where Salesforce highlighted that their forthcoming 2017 Connected Investor research will identify that 47% of investors would be happy for artificial intelligence to used by their wealth management firm the day began with a whirlwind of demos of disruptive technologies.  The videos of these will be up on the In|Vest website at http://conference.financial-planning.com/conferences/invest/ in a few weeks but in the meantime here are my highlights.

First up was Salesforce with their Financial Services Cloud providing great visualisation of relationships, interactions and delivering insight. It is clear from the number of integrations Financial Services has in the US that the American proposition is a long way ahead of their UK offering but this does give an indication of where Salesforce may be in the UK in a couple of years.

That said while the system can offer some awesome integration of consumer data I wonder how much of this would be allowed in Europe post the introduction of GDPR next May. This makes me wonder if the European Union and Fintech are on a collision course. I am increasingly worried that the excesses of GDPR and the EU’s inability to produce timely regulation could seriously damage the EU Fintech industry.

robot-507811_640.jpgRobert Stanich of IBM Watson showed how machine learning can identify clients at risk of leaving and how using artificial intelligence can transform client segmentation all beyond recognition. The service can also predict real life events and related product opportunities before your clients realise they have these needs. Watson has the potential to transform lead management so your existing data becomes your primary source of new business opportunities. 

Oranj showed a great onboarding experience with held-away data and risk profiling but fell foul of the eight-minute rule so ran out of time to show their full services. 

Comarch showed a very cool voice-controlled interactive artificial intelligence chatbot called Devra.

Advicent showed great life protection tools they have built which makes me wonder why the cool omnichannel protection service they built for Scottish Widows never saw the light of day. An opportunity missed.

MX then arrived to show why they do aggregation, categorisation and user interfaces for Personal Financial Management better than anyone else in the world. It is a great shame they don’t want to come to the UK as they have so much business in the States. 

Circle Black, a company that is entirely new to me, showed a stunning client facing tool set with API integration into Redtail, MoneyGuidePro, Riskalyze and many more.

Fidelity owned eMoneyAdvisor showed new marketing tools advisers can adopt to transform the way they use and manage social media and then onboard the resulting new clients. I continue to believe there would be huge benefits in Fidelity bringing their offerings to the UK.  

InvestCloud showed some of the over 200 Apps their adviser clients can use. I love the vast amount of data they are making easily available to their users and the virtually endless look, feel and design features advisers can adapt.

They are featured in the next update of F&TRC’s Adviser Software Insights study and have just set up an innovation centre in London so I will probably be looking at them in far more detail soon.

Riskalyze describe their role as protecting consumers against their worst decisions. I am a big fan of how they present risk to clients. To me it is so much better than stochastic pods. This is all about talking to clients in ways they understand. Their Autopilot approach with its One-Click Fiduciary makes a great case for the FCA reviewing the UK client money rules as it can offer better consumer outcomes at significantly lower cost.  

coins-1523383_640.jpgOne of the biggest moments of the day for me was Hello Wallet founder Matt Fellowes, the man who transformed financial wellness presenting his United Income business which aims to transform retirement income. This makes it beautifully simple to understand how clients are doing then build and achieve financial life goals. It is great to see United Income building plans taking consumers to +100 years stretching savings to match increased longevity.

I was also impressed by DataRobot  who are delivering a quick way to benefit from artificial intelligence, something I believe  advisers can make huge gains by embracing

Onist were one of my favourites from Finovate Spring and it is great to see them at In|Vest with their Family Office for the masses. I would love to see some of the artificial intelligence tools shown here added to Onist.

The afternoon session was opened by one of the most compelling speakers in the US advice market, United Capital ‘s Joe Duran. Outlining why advice firms need to be both extremely human and extremely digital, whilst insisting that the planning process can be fully digitized, he argued humans need to do to things machines cannot i.e. provide empathy, understand human behavior and provide expertise and judgment to help with complex decisions.

Charles Schwab CTO Timothy Heier pointed out we are no longer in mobile first phase, now it must be artificial intelligence first.  This shows the era of AI in financial advice is now upon us.

Mark Goines from Personal Capital highlighted that 65% of people who ever linked an account are still connected to them because they give them constant updates of good insights. He was followed by Bill Crager of Envestnet, who own Yodlee, who believes that a key component of building advice relationships with clients in the future is about giving consumers an integrated financial plan updated every day. This will actually provide a very gamified experience and I can see how it would have a similar effect to social media, we all want our regular fix of information and can’t resist looking at it regularly.

These will bring together consumers short term and long term financial lives with information they want to access regularly. Crager sees artificial intelligence delivering answers to financial questions based on the data the adviser will have aggregated via these services. 

These last two issues are very relevant to the challenges that will emerge as banks re-enter the financial advice market which I will be exploring in my Money Marketing column next week.

Through an invigorating and exhausting day the consistent message was we now need to start complimenting traditional advice services with unparalleled data and artificial intelligence to deliver a superior customer experience.

 

This has been a quick canter through my highlights of day one of In|Vest I will try and add more detail from my notes over the next week or so, so please revisit this page for an updated view. I will report on the second day of the event soon.

 

 

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