Recent Financial Advice Association Australia (FAAA) research has shown a significant portion of the financial advice sector are using, or planning to use, Artificial Intelligence (AI) in the workplace with expectations it will extend their reach to new clients and reduce the cost of their services.
Drawing on a study conducted by the Financial Planning Standards Board (FPSB) across more than 6200 financial planners in 24 nations, FAAA stated 82 per cent of Australian financial advice businesses operate with AI, or are piloting and planning its use with clients in the next 12 months, compared to 64 per cent of advisers globally.
FAAA added the main uses of AI among Australian advisers was for client communication and engagement (29 per cent), collecting client information (22 per cent) and market analysis and investment (6 per cent).
At the same time, half of the Australian practitioners surveyed believed AI would enhance the quality of their service proposition and 64 per cent believed it would lower the cost of advice.
FAAA chief executive Sarah Abood noted advisers currently using AI viewed it as a way to create access to underserviced communities while reducing the cost of advice to consumers.
“One of the clearest messages we hear from our members is that overly complex regulation, while well meaning, has driven many advisers out of the profession, making financial advice more expensive and harder to access,” Abood said.
“We need to cut unnecessary red tape and ensure that advisers can focus on delivering great outcomes for their clients. The research shows that a number of practices see AI as a useful tool in helping them achieve this.”
The industry body also recognised 52 per cent of Australian advisers expressed concerns about data privacy and cybersecurity and another 32 per cent were worried about the accuracy and reliability of AI-generated outputs. However, only 39 per cent had a policy in their business that guided the use of AI.
“AI has risks, but it also offers real and immediate potential to help manage some of the complex regulatory and administrative burden advisers are faced with,” she concluded.