Royal Commission findings change the focus of financial advice
How two fintechs partner to revolutionise the way clients are engaged
Findings from the Royal Commission concluded that financial advisers should be focusing on a client’s financial goals and their strategies for getting there, independently of the products they recommend.
According to the Australian Financial Review, as part of the Royal Commission; Rowena Orr questioned whether there was a conflict of interest for financial advisers who are “...providing advice as a representative of an institution that also makes products.”
GROW Super and Basiq are partnering to provide an innovative application for financial advisers called ‘GROW Professionals’. By leveraging a clients online bank and super fund details, predictive analysis enables advisers to provide ‘the right advice at the right time’. They can more easily focus on individual needs rather than just selling products.
It can take financial advisers and their clients up to four hours to perform a ‘fact find’ to determine a client’s financial position. Through the use of Basiq’s Open Banking platform, this information is automatically populated using clients online bank and super data - reducing the manual entry part of the ‘fact find’ down to a few minutes.
Josh Wilson, the CEO of GROW Super says “If a financial adviser can onboard clients in a fraction of the time, and focus on the value-add part of their job - it opens up financial advice to a much wider audience.”
GROW Professionals will fundamentally change the way financial advice is given. Traditionally, an adviser contacts their clients a few times a year at set times. Alex Naylor, the Head of Enterprise & Advice Solutions at GROW Super describes the product as “a powerful use of data algorithms that automatically notify the advisor so they can provide relevant advice at the right time.”
For example, a financial adviser can be notified when their client has a change to their monthly income - maybe the client received a redundancy payout or started paying additional rent. The adviser can contact their client and make recommendations to change their Super contribution or investment strategy.
Financial advisers will be able to filter and search for specific information about their clients such as the amount in their account. If there is a budget announcement that impacts a certain segment, an adviser can search for just those clients. Because GROW Professionals integrates with both their banking/super data (through Basiq), the financial adviser has a picture of their whole financial situation, including the clients goals and how they’re tracking.
GROW Super is known for its appeal to Millenials with their Round-up application that encourages clients to contribute more, as a way to meet their retirement savings goals. GROW Professionals isn’t just geared at advisers, but more broadly across superfunds, dealer groups and larger licensees. Successful pilots have already occured within the IOOF adviser network but is being rolled out across other financial advice organisations.
GROW and Basiq have partnered to provide this innovative application. Basiq’s ‘Connect API’ enables fintechs like GROW to access online bank data across 72 different Financial Institutions and all of the major Super Funds. Damir Cuca, CEO of Basiq talks about GROW’s unique ability to innovate in the crowded Super Fund industry “We really enjoy partnering with fintechs who innovate - they aren’t just taking advantage of Open Banking data; but also doing cool things with Super Funds data which is changing the landscape of financial advice.”
Basiq is an Open Banking Platform backed by Westpac and NAB. They have built some of this innovative thinking into their ‘Affordability API’ product, which a number of financial advice fintechs are using. “By using Machine Learning, the data is intelligently summarised based on a client's financial position.” says Kate Fama-Lombardo, Head of Product Innovation at Basiq.
In summary, GROW and Basiq have partnered to provide an application which will fundamentally change the way financial advice is given. By taking advantage of not only online banking data, but also online Super Fund information, GROW Professional enables financial advisers to spend less time on ‘fact finds’, and more time on the clients’ individual needs. Client contact will be driven by events in their life and advice will be relevant to their specific situation.
Also featured in the Australian Financial Review: https://www.afr.com/technology/open-banking-rules-fuel-financial-planning-shakeup-20180706-h12bwc