The year 2020 will live long in the memory of many; the coronavirus pandemic has deeply affected both our personal and working lives. In December, in the first episode of our new regular podcast, the Intelliflo Insider, Catherine Morgan (Founder, The Money Panel) and Ian McKenna (Fintech founder, columnist & financial services futurist) joined me to explore the effects of Covid-19 on fintech during the previous 12 months and discuss how it could shape 2021.
It’s fair to say that most advice firms are heading into 2021 well prepared for what could lie ahead. With the UK in its third national lockdown (at the time of writing), advisers have become accustomed to conducting business remotely. A survey we conducted in August 2020 found that 84% of advice firms were now fully optimised to work from home, up from 47% in March.
Much has been made about how about the resilience firms have shown during this difficult period, which I think bodes well for the future of the advice profession. Firms will now have the confidence to function effectively regardless of where staff are located.
It’s now key to ensure the learning points from the previous 12 months are put into action. As all participants in our podcast noted, during 2020 we saw the biggest shift for some time, perhaps ever, in how financial advice is delivered. The technology to communicate with each other virtually has been around for some time, but it’s taken the effects of the pandemic to encourage, and in some cases force, wider embracement. This hopefully means the industry will be more receptive to adopting future technology.
New tech
So what new technology could we see greater adoption of this year?
Catherine Morgan flagged Open Banking and behavioural science and expected to see shifts in how firms communicate on social media. She highlighted research by her firm which found that people are engaging more with podcasts than they are with blogs: It’s almost that hybrid between financial advice and financial coaching [which will appeal to] a bigger variety of clients.
She also suggested that there’s a big opportunity for those harnessing social media, and also willing to stick with it. Firms are using social media to increase their visibility; a key element to build a profitable advice business in the current world.
Communication
Social distancing measures have forced many new working practices - advisers and their clients are now communicating with each other using a variety of channels. This is proof of adaptability, according to Ian McKenna. He said the effects of the pandemic may have accelerated some much-needed improvements to the advice process. Some of things that advisers have been calling on for years, such as electronic signatures, are the only way of doing business.
Another benefit of the broadening communication channels is the opportunity to engage with a wider universe of clients. Firms previously uncomfortable with some pieces of tech will now be finding it second nature, meaning clients can not only be contacted quickly and efficiently, but also via their preferred channel. There are significant benefits to this. One of those, as Ian points out, is the evidence that during periods of market volatility, advised clients didn’t panic and make rash investment decisions, largely because advisers had the technology in place to quickly address any concerns and provide the necessary reassurance.
Being considerate
With so much focus on the role of technology, it’s easy to forget the most important component of advice businesses: their staff. The effects of the pandemic, and in particular the multiple lockdowns, has brought with it many emotional and physical challenges.
A core focus for Intelliflo during 2021 is our staff. The wellbeing aspect of the pandemic is likely to outlive the other challenges. Be considerate to your staff and see how you can help them.
