Five tech trends changing financial advice

The world of financial investment has been transformed by technology over the past decade. Advances in software, web-enabled communication, mobility and the cloud have all left their mark and changed the everyday activities of advisers, planners and finance professionals.

As technology continues to evolve tomorrow’s financial adviser will look and perform very differently thanks to tools and applications involving artificial intelligence (AI), the Internet of Things (IoT) and automation - not to mention technology yet to be developed. 

" As technology continues to evolve tomorrow’s financial advisor will look and perform very differently.”  - Andrew Tucker, CEO, ITonCloud 

Even if we look ahead just a few years, we can begin to see some of the impacts technology could have on the finance industry. 

The cloud

While many financial advisers have already embraced it, the use of the “cloud” will continue to expand as advisers seek to have more of their business operations and applications hosted there.

This move is being driven by the need for greater cost efficiencies and simplified IT infrastructure. 

Cloud-first approaches are becoming more popular in the finance sector and with all their IT hosted there firms will no longer have to worry about hosting, maintaining or backing up their IT environments.

The choices in cloud providers will also continue to increase across public, private and hybrid options. To date public cloud has been the fastest growing cloud segment, mostly thanks to large players like Google, Microsoft and Amazon.

Private cloud providers are also starting to make ground, particularly in the SME arena, drawn to the option because of the more personalised and customised service on offer.

Hybrid cloud is also growing in popularity, more so at the enterprise level. Firms use a combination of public cloud and in-house private cloud to quickly expand capacity. However, this option can be expensive to set up and run.


Automation has already begun to reshape financial services. Especially in the areas of regulation, financial risk management and compliance, automation is going to have a big impact. Imagine an automated program that could identify and explain alterations in risk exposure and calculate business-related and data-related causes for such changes.

As the result of this increasing automation across the business, enabling certain time consuming tasks to be completed at high speed and with consistent quality, we’ll continue to see increased productivity and cost effectiveness. It will also mean advisers will be able to add value in other areas or develop new offerings.

The Internet of Things (IoT) will also have a greater impact on the financial services sector.

According to PwC’s sixth annual digital IQ survey financial services is one of the top 10 industries investing in potential IoT innovations.

This makes sense when you consider IoT’s strength lies in the transfer of data and the financial sector relies heavily on gathering and analysing data. 

“Like many industries, financial advice is being disrupted by technology at an increasing pace,” Shez Ford, General Manager, ANZ Financial Planning says. “While this can be confronting for some, we know the human element will always be a critical element of the advice process.”

“The challenge is finding a balance between the human interaction and technology to offer the best possible experience for adviser and client.”

“If we take automation as an example, we’re currently trialling a process to replace a paper-based insurance application process with an iPad application which standardises decision-making and automates more than 180 business decisions.”

“This will save our advisers up to four hours of administration per customer, which they can better use to provide a more effective service.”

Ford says the rules are not all hard and fast and there is plenty of room for the planner to drive the advice process - and outcomes - in consultation with the customer.

“Not only are these advances giving our planners time back they are helping them engage clients throughout the advice process with innovative design that assists in making complex concepts more easily understood,” she says.

“At, the end of the day many people want the comfort that comes from a conversation, particularly those clients with complex needs.”

Data security

With advisers holding sensitive data as well as increasing regulation around the security of customer data and communicating breaches, maintaining data security will remain a growing priority and focus.

According to the 2016 Ponemon Institute Cost of Data Breach study, the average cost of data breach to a company is $A2.64 million, with the biggest consequence of data breach being lost business.

The 2016 Ponemon Institute Data Protection Benchmark Study showed organisations around the world deal with an average of 20 data loss incidents every day.

Advisers will need to implement robust procedures and processes around data security, while at the same time keep up with changing regulations to adequately manage data security risk.

This may involve assessing where critical data is stored in regard to security, reliability and accessibility and whether it’s stored in data centres or on-site servers.


Roboadvisers have had a contentious start in Australia, though they’re unlikely to fade away as technology advances. In fact, according to BI Intelligence, it is predicted by 2020 roboadvisers will manage around 10 per cent of the total global assets under management, equating to around $A8 trillion.

Roboadvisers are likely to become more adaptive and intelligent and put pressure on the traditional role of advisers and fund managers, although not completely replace them.

While startups will gain ground, it will also be the large incumbent firms that will embrace this technology and launch their own products.  

Tech-empowered customers

Today consumers have access to almost the same information as advisers, and in real-time from almost anywhere.

For instance, according to the Australian Prudential Regulation Authority and the Australian Tax Office, there are close to 600,000 self-managed super funds (SMSFs) in operation, managing $A653.8 billion in assets, with thousands of new SMSFs being established every quarter.

No longer are investors bound to advisers for financial information as they once were and do-it-yourself investing is becoming more popular.

This means advisers have to continue to add value by providing expert analysis and advice.

Like many other industries, financial advice and planning is being disrupted by technology at an increasing pace.

These are just some of the ways advancing technology is likely to impact the finance sector. It is certainly a space to pay attention to.

Andrew Tucker is CEO of ITonCloud which offers cloud-based virtual managed desktops for business

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

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