The poor public perception of advice, despite the headlines, is not purely siloed to an impression of the institutional vertical advice businesses. While the headlines of 2016 have centered on the advice industry’s major players, it is the entire function of “advice” that has been called into question.
The CBA has recently been reported as progressing to $11 million in compensation so far . The NAB has paid $6.5 million in compensation . Anticipating a parliamentary inquiry and to reduce the call by the left side of politics for a Royal Commission the banks have tightened standards on hiring protocols of advisers .
However, if we are to truly find alignment between advice provision and consumer engagement then there are four core elements that both the advice industry and the consumer can actually find some common ground. Three are: price, efficiency and delivering advice that is in line with the consumers’ goals. And the fourth element that is often unspoken but acts as the safeguard, is the documentation of the advice process in a way that is easy to understand, recall and acts to protect both the adviser and the consumer.
Compliance, and the recording of the process of advice is one of the most critically difficult aspects of the advice process for a financial service provider to manage as the process around the proper dispensing of advice relies still on archaic methodologies. File notes, a Statement of Advice and an Authority to Proceed have provided little comfort to an advice business when faced with a disappointed customer whose measure in litigation is what would a “reasonable person” would have expected.
Is there a better process for documenting advice?
In implementing that process can there be a greater probability that advice will be delivered in line with the clients wants?
Can a new process reduce the price of advice and enhance the efficiency?
If a new way of delivering advice was adopted by advisers, then the cost of the advice being provided could also be reduced. Standard Charter, became the first bank in Malaysia to offer video banking across different customer sectors including its high end customers. “Standard Charter Bank Malaysia, said clients using the Video Banking service will be able to securely interact with banking consultants via video, audio and chat, with the flexibility and convenience of banking from any location using their laptop.” Video Banking transform the way we deliver client service”.
“Financial institutions need to become more innovative with their communication if they are to continue to attract and retain their customers. Fortunately, advances in both mobile and broadband data speeds, increased affordability, and developments in video collaboration hardware and software have made the video experience a much more powerful tool for customer service”.
Indeed, as long ago as 2014, Nationwide became the first in Europe to offer a “video link” service to give consumers greater access to mortgage advice.
Key takeout’s are that the places where video adds value and helps are :
1. Anytime, anywhere: Save the expense of travel while retaining the personal connection of face-to-face communication; your specialist advisors can be available to your entire customer base without time and cost wasted commuting
2. Personal consultation: The customer relationship relies on having a solid, honest and personable conversations. Video enables you to maintain and build customer intimacy more effectively than phone or digital based engagements
Applying this to the broad financial services sector the applications are clear across mortgage providers, banks, financial advisers, insurance advisers. Prospect assessment, busy clients, video in a non-working spouse from home whilst the partner is in your office, video in a couple who work/or are in different locations (neither of them need to be in your office), remote clients, Statement of Advice presentation, Insurance applications, revised terms, for your onboarding process, and client reviews, just to name a few.
From a compliance point of view, with recordable video meetings and recordable document signing online, the solution to the adequacy of file notes is provided. If an adviser with about 60 clients talks with two clients every day, then over a two-year period that’s more than 900 conversations. It would take a pretty good memory to recall Mrs Smith’s preferences for movies, her grandson’s travel plans, or her favourite emerging market. (Professional Planner). Video provides the solution.
How Video Will Transform Advice White Paper – Click here to download!
Author: Andy Marshall