The financial services industry event at The Emirates – Old Trafford heard Sinclair predict that true robo mortgage advice is “not coming in my lifetime” and outline how even the largest, so-called ‘robo advisers’ had needed to change their structures in order to incorporate human advisers into their propositions.
He said: “Even the emerging firms – the likes of Habito and Trussle – have had to employ a lot of advisers to go out and do the job. To write the algorithm that does what you do, to automate it, is too difficult with the thousands of products, the thousands of different criteria, the different nature of most of the customers that talk to you. All these complex income streams, complex structures and family lives, plus the cost of putting this together, make it almost impossible.”
Sinclair argued that lenders might need to change the way they operated: “Getting closer to robo advice - as firms being to scrape data to manage it - means lenders would need to begin to change the way they think about affordability, in order to make that model work.”
Even though Sinclair said technology was not about to usurp the adviser’s role anytime soon, he did warn firms to be aware of existing technology, what might come next, and how long before they might be impacted.
He said: “It’s going to be difficult but technology is coming fast to change the world you’re working in because front-end data capture is going to be automated.
Customers are going to expect that they can track the transaction online all the way through the process to see what’s going on. You’ll also want to see all that data so that you can see what stage the process is at in order to track what is a complex transaction. The data is going to be important. Do I think you, the adviser, are going to be redundant because of the changes in tech? No. There is a bit in the middle which ensures your job is the last to get decimated. Other sectors – surveying, conveyancing – will move quite quickly but you will be protected longer than the rest.”
Richard Howells, Managing Director of Sesame Bankhall Group, agreed that advisers were still in a strong position, and held a unique position in terms of the data they held and how this could help them ensure they remain the ‘primary contact’ for their clients.
He said: “Brokers are in a fantastic position to be in the primary relationship with the customer because they inherently trust you. So, we shouldn’t waste the opportunity to broaden the proposition we offer to our customers utilising that trusted relationship status.
Brokers have got the best legitimate interest, under GDPR rules, to hold the broadest set of data. More so than any of the providers, lenders, etc. Think about your technology strategy and how you can use that broad set of data to broaden your proposition to customers so that you remain the primary relationship.”
Howells did however have a warning for advisers: “Be careful about where you invest your money. You are already sitting on a large amount of data – evaluate and assess the richness of that data before you bring in other data from outside sources.”
