The latest industry research has shown Australians’ faith in robo-advice is increasing, while their trust in person-to-person financial advice is waning in the wake of events such as the banking royal commission.
The study commissioned by Thinque revealed 30 per cent of Australians would trust a robot to deliver them financial advice. In comparison, only 9 per cent of those surveyed said they would trust an automated process to provide relationship counselling or any other type of longer-term advice such as that concerning their career or marriage.
“Previously, Australians have trusted digital tools with purely transactional activities such as mobile payments. However, when it comes to more strategic life advice, we are now beginning to trust AI to advise us in sectors such as health and travel, and increasingly we are entrusting robots in the banking and finance sector, as many Australians’ distrust in human advisers has mushroomed in the wake of the royal commission,” global futurist and innovation strategist Anders Sörman-Nilsson said.
However, the study confirmed Australians were still worried about digital fraud within the financial services sector, with 80 per cent of respondents admitting they were most concerned about this issue. This compared to lesser angst over other subjects, with 56 per cent of participants saying they were most concerned about fraud in the government sector, 46 per cent of respondents citing insurance fraud as their biggest concern and another 39 per cent most troubled about health sector fraud.
The main anxiety among respondents focused on data security, with 41 per cent of them believing the likelihood of information falling into the wrong hands was greater due to the electronic medium.
According to Sörman-Nilsson, both consumers and financial advisers have a role to play in alleviating concerns about this type of threat.
“Consumers must learn to scenario plan when it comes to both fraud and the use of robo (or human) advisers to ensure their financial safety in any eventuality,” he said.
“In turn, financial advisers in particular need to look at how to rebuild public trust in this digital age. They have lost their voice and partially forgotten to story-tell and build a narrative of trust – digitally – and are thus failing to re-engage Australians at a time when more Australians than ever actually need financial advice.”
The Thinque study was conducted by The Digital Edge Research Company during January and analysed responses from over 1000 people.