As automation and robotics start to claim more jobs, how will the financial services industry be impacted?
Imagine robotic algorithms and computers that can recommend home advice, superannuation schemes, health insurance and property conveyancing, all without the intervention of a human. It sounds like science fiction but it’s now a reality.
The Australian reported on the emerging trend of ‘robot advice’ being rolled out as part of a new approach to financial advising.
With advances in machine learning and artificial intelligence, these ‘robo-advisors’ can now use computer algorithms to number-crunch financial information to offer advice to customers. Machine learning means robots can ‘learn’ – and in the financial services space this may include learning colloquial language through interaction with people in what’s called natural language processing.
The Australian reported that the practice is well-underway overseas, with US-based financial services provider Raymond James Financial announcing it will offer robo-advisors to clients by the end of 2017.
Start-ups are also benefitting from the technology breakthroughs. Australian start-up HashChing is one example. The company - which has plans to expand to the New Zealand market over the next 12 months - offers consumers an online marketplace for home loans and their website offers 60-70 options for clients; it then uses algorithms to prioritise rates for customers based on what pervious customers had chosen nearby.
“Before we were doing it manually — we were setting the brokers as premium brokers manually by looking at their performance; now the algorithm automatically does that,” founder and CIO Atul Narang explained to The Australian.
“Now the algorithm automatically checks for the broker’s performance based on their review rating, the conversion rate and response time. It then automatically picks that broker as a premium broker.
“That has a direct impact on our business. We don’t want to burn our leads giving (business) to brokers who are not performing.”
Other tools in development by HashChing include a predictive analytics tool that will tell customers which loan deals in their areas are trending, and a ‘chatbot’ to handle customer inquiries.
However, the reaction from consumers is yet to be seen, with critics pointing to issues like consumer privacy being a potential stumbling block for this form of interaction with financial institutions.
Tell us below - how do you see sophisticated technology potentially impacting the jobs and services offered in your organisation?