Artificial Intelligence Revolutionizing Financial Advice for IFAs

Artificial intelligence (AI) is transforming the landscape of financial advice, presenting a “win-win situation” for independent financial advisors (IFAs) and their clients. According to Mike Curtis, co-founder and chief technology officer (CTO) of Multiply, implementing AI into financial advice is highly beneficial for customers. Despite concerns and uncertainty surrounding the technology, the integration of AI brings unprecedented opportunities.

Rather than replacing human advisors, Multiply aims to license its AI software to advisory firms, empowering them to launch their own AI-powered apps. Currently, there is significant interest in Multiply’s technology, with approximately two dozen financial firms actively engaged in discussions to roll out the Multiply tech as an app. These firms span across various sectors, including life insurance firms, banks, and advisory companies of different sizes.

Vivek Madlani, co-founder and chief executive of Multiply, shares that the company was established nearly seven years ago with the vision of making financial advice more accessible. By leveraging AI, Multiply has created a cost-effective alternative to traditional face-to-face advice. Madlani states that utilizing the Multiply software can reduce advice costs for firms by up to 90%.

While AI is revolutionizing financial advice, Madlani emphasizes the enduring value of human advisors. Having spent 12 years in the finance industry, he witnessed firsthand the significance of the human touch in advisory services. Curtis, with his tech background, also believes that AI will not replace human advisors but rather enable them to focus on areas where human expertise is indispensable.

The proliferation of AI-powered chatbots, such as ChatGPT, has prompted the financial industry to adapt to changing consumer behaviors. People are increasingly seeking financial advice from digital apps, necessitating a response from traditional advice providers. The advent of AI technology has created a new paradigm for the industry.

While Multiply initially offered a direct-to-consumer (D2C) app, overwhelming demand has steered the company toward catering to the advice market. Madlani underscores that the overall goal is to reshape people’s default perception of being bad with money. Through the help of AI-powered apps, cheaper and accessible advice can transform financial behaviors, ultimately shifting the default response to being good with money.

Implementing AI into financial advice is revolutionizing the sector, empowering IFAs to augment their services with cutting-edge technology. With Multiply leading the charge, the industry is poised for a transformative future.

Frequently Asked Questions (FAQ)

1. Will AI replace human financial advisors?

No, AI is not intended to replace human financial advisors. Instead, it enhances their capabilities by automating certain processes and providing support in analyzing vast amounts of data. The goal is to allow advisors to focus on areas where their human expertise is most valuable.

2. How can AI make financial advice more accessible?

AI-powered apps and software offer a cost-effective alternative to traditional face-to-face advice. By leveraging technology, advisory firms can provide more affordable services, enabling a broader range of individuals to access professional financial guidance.

3. What role do AI chatbots play in financial advice?

AI chatbots, like ChatGPT, are revolutionizing customer interactions and transforming the way people seek financial advice. They provide convenient, round-the-clock support and guidance, making it easier for individuals to access basic financial information and assistance.

4. Is Multiply the only regulated firm providing AI services in the financial industry?

According to Vivek Madlani, co-founder and chief executive of Multiply, they believe to be the only regulated firm offering AI services within the financial sector. The company operates under the oversight of the Financial Conduct Authority (FCA), ensuring that their AI-powered solutions comply with industry regulations and standards.