People more likely to seek friends’ advice for money decisions rather than “robo-advice”
31 May 2017
People were more likely to turn to a friend than seek "robo-advice" to help them when it came to making money decisions, according to research.
A survey of consumers across 15 countries, including 1,000 in the UK, has found that only 3 per cent in Europe would be willing to give up control over their hand over their finances to a robo-adviser that would act on their behalf without them first giving the go-ahead.
A robo-adviser computer programme learns people's preferences and invests money on the basis of this information. People in the UK too shared the views across Europe, with only 3 per cent of UK citizens saying they would allow a computer to conduct financial activities without it needing their approval, the ING International Survey Mobile Banking 2017 - Newer Technologies, found.
According to the international survey, generally while seeking investment advice, two-fifths (40 per cent) of people would seek out a human financial adviser, while investing, while 14 per cent would speak to friends and family.
Alternatively, 16 per cent of people were willing to find the information they sought on their own via the internet and specialist websites, the research found.
ING behavioural scientist Nathalie Spencer said: "Letting algorithms make money decisions for us has the potential to be really advantageous and free up some headspace - yet we found that many people are reluctant to give up control of these decisions.
According to the survey of 15,000 people across 15 countries, 91 per cent of respondents would not let robo-advisers act unilaterally. A quarter of those surveyed would only consider machines' advice so long as the human customer got final approval.
The robo-advice market was originally developed by startups such as Wealthfront and Betterment that looked to challenge the traditional financial advice sector by offering automated investment advice to clients through web-based platforms.