IFAs: Are you looking to switch your wealth management platform provider in 2024?
If you are, you’re not alone. Statistics announced at the Empowering Advice Through Technology expo (#EATT2024) showed that 95% of UK IFAs aim to invest more in technology, and almost half are looking to change the platform they’re using. A greater choice of platforms, and new technologies such as AI, are obvious developments that are driving this trend, but there are more factors at play too.
That’s the view of Richard Knights, head of sales at Centology in this specialist sector of the IFA-focused tech market: “2024 could be a real tipping point both in terms of the number of UK advisers who are embracing technology, and the types of platforms they are using. It’s true that many IFAs have been early adopters of wealth management technology but, as we have also seen in some other financial services sectors, there has been a degree of inertia too.
“That’s understandable, especially for IFAs who may worry that the work involved in migrating to a new platform could create bigger problems in the short term than it solves in the long term. However, from Centology’s viewpoint we can see that attitudes across the financial advisory sector are changing as more and better solutions become available, so 2024 could be a significant year.”
Frustration with the limits of incumbent wealth management technologies is shared by many UK IFAs today, Knight said. “The feedback we receive from many advisers is that they want a high-level of integration which avoids the need for repeated re-keying and duplication of data. Most importantly, IFAs are looking for solutions which offer a seamless, hassle-free migration to a genuine fully-integrated platform which meets ISO standards. They want comprehensive solutions which will offer a clear return on investment in terms of improving efficiency and customer service.
“Bespoke client portals and dashboards, automated workflows and task management, plus digital KYC and onboarding are among the many features advisers are looking for platforms to provide. While some platforms have offered a few of these key features, until recently it’s been necessary to ‘bolt on’ additional features and functions from other sources too.
“What makes things different now is that Centology and other businesses in this sector are offering a truly integrated solution, and we can see that this is having an impact on addressing the inertia in sections of the industry which has perhaps slowed the pace of change in the past. The EATT research stats clearly show there’s a strong interest in investing in this type of technology.
“We’re expecting the increased availability of cost-effective, comprehensive solutions which meet the current and future needs of IFAs to translate into increased levels of adoption. We say that for two main reasons. Firstly, because advisers want to keep pace with their competitors, and secondly because they can see the added value the latest technology provides, both in terms of efficient management of higher numbers of clients and the quality of service it delivers.”
“As is the case in many other sectors, the ever-increasing power of AI creates rewards, and risks, in the financial advice sector too. “Advisers will of course be looking for simple, efficient and scalable solutions when choosing the best platform to suit their and their clients’ needs,” said Knights.
“But in the context of what AI can do, and how it’s currently being used in the context of applications related to Consumer Duty compliance for example, it’s also essential to consider how this can impact data protection and security.
This is an important factor to consider when IFAs are looking to choose a wealth management platform provider. Leading providers today are taking a measured approach to AI so that its power is used to improve efficiency, but at the same time includes safeguards to ensure compliance. While technology will continue to transform how advisers do business, from a clients’ point of view trust in their IFA will continue to be as important as it has always been.”
