In May this year, The Financial Conduct Authority (FCA) declared that many consumers still aren’t getting the advice they need before purchasing financial products. It was even implied that consumers are potentially leaving themselves at risk of being taken advantage of. Their recent report, the Financial Advice Market Review, found that up to 16 million people could be trapped in a “financial advice gap” where they need advice but aren’t able to afford the high costs.

In a bid to help, many big lenders are turning to alternative ways of streamlining their advice and ensuring it is more readily available and visible online. However, consumers still need compliant and transparent advice that takes into account every aspect of their individual finances and it is important that technology-only processes do not leave many unable to access credit.

At Freedom for Intermediaries, technology helps advisors find the best lending options for their client, but automated ‘robo-advice’ may be taking us a step backwards, as it removes the intermediary from the process and eliminates the customer focus and human touch that we think every customer deserves.  As with any financial commitment, consumers should have access to qualified people who can provide them with the best advice possible.

Serving all customers

Customers with low credit scores may find that they can’t move through a loan application quickly. For some, being self-employed with inconsistent cash-flows could mean they are rejected for a loan. Others may have experienced unexpected complications in their lives, such as divorce, which reflect negatively on their credit scores and leave them unable to access credit.  For these people, tailored and bespoke solutions which could be appropriate for their situation are not often shown at the top of search engine results.

Strict and automatic lending criteria are usually the first barrier for many of these customers. On top of this, the emergence of robo-advice could mean that more and more genuinely creditworthy customers will be locked out of the best rates or accessing credit all together.

It is becoming increasingly important that clients are well informed before making any financial decisions. Intermediaries can offer first hand advice and fully qualified explanations around the different options on offer.