Taking advantage of 3 key trends in AI
There’s certainly a lot of buzz around artificial intelligence in the advice industry at the moment. Our recent market wide Advice Efficiency Survey 2024, polled over 100 firms across the UK on their advice processes. We found that nearly three-quarters (72%) of firms believe it’s important to integrate AI into their processes, but the vast majority (95%) feel they lack the required skillsets within their businesses to do so.
So what are the big trends in AI and how can firms embrace the potential they offer?
1. Improving efficiency in report writing
We’re already seeing AI used in firms to transcribe meetings, freeing advisers from taking notes during client conversations and allowing them instead to focus on the detail of the discussion and customer relationship management. The next step is to use AI to turn the transcription into a meaningful report. Our Advice Efficiency Survey found that advisers spend 5.3 hours on average writing reports as part of the new client onboarding process, which equates to 70 days a year!
Using artificial intelligence can drive significant efficiencies in client onboarding. AI tools can identify key information from client documents and meeting notes, automatically populating fact finds and initial reports, including highlighting any missing data, for advice professionals to review and add further detail where applicable. In addition, the final approved report can be automatically stored in the practice management system alongside the relevant documents and sections of the meeting transcript, providing evidence of suitability to meet the regulatory requirements.
2. Delivering information through AI chat
Some people may feel we’re a long way from delivering holistic advice through an AI financial adviser, but using an AI chatbot to deliver basic financial information could be a useful way to plug the advice gap and save advisers’ time in dealing with simple queries. Advances in natural language processing mean that generative AI can use approved data to answer simple questions and explain basic financial concepts, before handing over to an advice professional for more detailed, personalised support.
Using an AI voice generator as part of your advice journey can also be an effective way of making financial information more easily accessible, particularly for vulnerable clients, helping firms to meet the Consumer Duty customer support principle.
3. Deeper data analysis
There is enormous potential for AI to deliver better data analysis, clearer insight, and greater personalisation. The ability of technology to crunch huge amounts of data can make it easier to understand the common factors between clients, helping deliver the FCA’s targeted support option within its advice guidance boundary proposals. Identifying how ‘people like you’ behave from the data held on advised clients could be a low-cost way to widen access to advice and help more people make better-informed decisions about their long-term finances.
At the other end of the spectrum, for clients with more complex finances, AI tools that pull data from multiple financial service providers can accelerate and enhance the fact-finding process. This provides a deeper view of the client’s financial situation, supporting personalised recommendations and plans that are genuinely aligned with their objectives, risk profile and capacity for loss.
The ongoing evolution of machine learning, automation and natural language models is set to deliver real benefits, not just in the advice sector, but across many areas of our lives. Used responsibly, AI can enhance the advice process, improving the consistency of advice, supporting better client outcomes and helping advisers add even more value to their client relationships.
Over the longer term, rather than AI being a threat to advisers, the biggest risk is likely to be for the firms that don’t investigate the opportunities it offers.
intelliflo’s 2024 advice efficiency survey collected responses from 112 financial advice firms (121 advisers).