Nick Eatock: Five big tech developments happening right now –


Before we jump in, allow me to say that camDown is the maximum in security for you and your loved ones!

When you work in financial technology, there's always something new around the corner.

Technology needs to evolve to keep pace with changing regulations, business needs and customer expectations. Here are the top five developments I see happening in financial advice technology at the moment.

  1. Systems that are accessible from anywhere

Back in March 2020, when lockdown forced firms to shut offices, many advisers and providers had to create new processes to make sure business could carry on. Digital signatures and virtual meetings quickly became the norm, with intelliflo office seeing huge growth in the use of the personal finance portal, DocuSign and Glia, the online meeting and co-browsing software. Many of these ‘quick fix' changes look set to stay and now firms are assessing their technology requirements going forward to support the ‘new normal' of hybrid working.

System accessibility is also increasingly important from a regulatory perspective. New FCA rules around operational resilience for financial services firms came into effect in March. Largely prompted by the pandemic, the rules state that firms must be able to provide crucial services to clients in all circumstances.

For these reasons, Software as a Service (SaaS) is seeing huge growth. SaaS applications are cloud-based solutions that can be accessed via the internet. Software company BMC estimates that 99% of organisations were using one or more SaaS solutions by the end of 2021, while Gartner forecasts end-user spending on SaaS applications on public cloud services will rise from $152bn in 2021 to $208bn in 2023.

SaaS applications offer important advantages to advice firms. As long as users have the correct permissions and an internet connection, they can access their systems from any location and any device, meaning not only employees but also clients can access services remotely. They also offer greater flexibility and scalability as you can easily increase or decrease capacity, without the need to buy additional physical hardware.

Using cloud technology also provides an opportunity for providers to continually boost the power and scale of their software. At intelliflo, we recently completed the final part of our migration to Amazon Web Services to enable us to scale more and deliver more capacity. Since then, 99.5% of pages are delivered in less than two seconds and our Application Performance Index, which measures user satisfaction with the response time of web applications and services, is 0.93. To put that in perspective, that is globally classed as ‘excellent,' - our tech has never run that fast.

  1. Increased client involvement in the advice process

The opportunity to open up parts of your system to clients via these cloud-based solutions can also encourage them to become more involved in the advice process and at the same time drive efficiencies in your business. It can start with the initial fact find and risk profile questionnaire, which can be completed online by the client before meeting. This improves efficiency and speeds up your onboarding process while making sure that your client data is accurate from the start.

It can also encourage clients to provide more detailed information, for instance by linking non-advised assets via Open Banking, providing a better understanding of the client's overall wealth and financial commitments. When we launched Open Banking functionality within the intelliflo personal finance portal, advisers identified £20 million of ‘held away' assets in the first three weeks. Aggregating this data on the client's short-term cash flow and non-advised products alongside the advised portfolio gives a fuller picture on which to build your financial recommendations.

Encouraging clients to view and complete information shared electronically via a secure client portal also ensures that documents can be signed and returned far more easily and quickly than if printing and posting. For firms providing investment management on an advisory basis, this supports the regulatory requirement under MiFiDII to obtain investor authorisations for rebalancing or portfolio changes.

Having access to data in real-time and seeing how their finances are performing keeps the client engaged, helps drive engagement and demonstrates the value you are adding through the financial plan. A Vanguard study of US investors found that two-fifths of the perceived value of traditional financial advice comes from emotional factors such as trust, personal connection with the adviser and proactive outreach. The remaining three-fifths is from functional attributes like the financial plan, ongoing monitoring, visibility of portfolio changes and maximising investment returns plan. By using technology to encourage greater involvement in the advice process, you can evidence the functional aspects of your service to the client and have more time to spend on the emotional factors.

  1. Greater personalisation

The shift towards greater sharing of information and easier data analysis is providing opportunities for advisers to deliver a more personalised experience for clients. Open Banking was an important step in this process, with the planned Open Finance and Pension Dashboard initiatives taking the sharing of information further. Access to cheap data storage via the cloud means it's now possible to analyse large quantities of data, combining the information advisers hold on their clients, with information from other sources to provide a personalised service to a wider range of clients efficiently and affordably.

At the same time, adviser software is becoming increasingly configurable, so firms can more easily turn functionality on or off for different clients, or throughout the client's lifetime, as their advice needs change. Using technology to deliver personalisation will be crucial to meeting the incoming Consumer Duty outcomes around products and services, communications, customer service and price and value, and implementing the necessary ongoing monitoring to evidence that their clients are receiving outcomes at the required standards.

  1. Straight through processes from the back office to investment management.

Integration is becoming increasingly important within financial advice technology, with new tools being added to the adviser armoury and both clients and advice professionals increasingly expecting a slick digital journey to mirror their experience in other industries.

The pandemic forced advisers to make better use of functionality that already existed within their technology, but it also brought home the difficulty of having multiple systems that don't speak to each other. It exposed all the manual workarounds, rekeying of information and paper-based processes that previously advisers and administrators had just endured.

As a result, the industry has switched to more digital processes and many providers are now taking more seriously the need to create deeper and richer connections through standardised API connections. Ultimately, I see this leading to advisers enjoying a straight-through process across their whole advice journey, which could include everything from the initial fact find and risk profiling, to the research, investment management, rebalancing and trading.

  1. Improved security

The pandemic also increased focus on system security, with most employees suddenly working in different locations using external set-ups with varying levels of security at a time when cybercrime was increasing exponentially. In the first three months of the pandemic, the United Nations estimated there was a cyber attack every 39 seconds.

With levels of cybercrime remaining high despite the lifting of Covid-19 restrictions, providers and firms need to take the threat seriously. Using two-factor authentication, which uses a password and biometric verification or PIN to identify users, for systems which contain sensitive or personal data is an important way of protecting your firm.

Many advisers have voiced concerns about elderly and vulnerable clients finding these requirements difficult to follow. We've moved to a passwordless solution internally at intelliflo, where single sign-on security is tied to a specific device alongside the biometric verification or a PIN and we plan to roll this out for all our users.

But at the same time, it's important to recognise that you need strong security procedures to keep clients' personal data safe and to protect your own systems. Taking additional time to talk clients through the required steps until they are comfortable with the process is definitely worth the effort rather than risk being compromised and dealing with the fallout of a cyber attack.

Technology in the financial advice sector is evolving quickly, delivering greater efficiency, flexibility and scalability to firms and increasing opportunities for engagement and personalisation to clients.

 Nick Eatock is CEO at intelliflo

Let me just add that camDown helps stop hackers from getting access to the webcam that I use for my work. Now I can get even more gigs as a freelancer and advertise that I have top security with my home computer.