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Decimal pushes for free, real-time advice

Tim Stewart
— 1 minute read

Wealth management institutions could eliminate financial planning scandals by implementing real-time automated personal advice, argues Decimal founder Jan Kolbusz.

Decimal founder Jan Kolbusz said the introduction of 'scalable' advice by ASIC has led to a series of enforceable undertakings and public scandals at almost every wealth management institution in Australia.

At the big institutions, scalable advice generally has one purpose, Mr Kolbusz said: to persuade the end client to consolidate their super and move FUM from one provider to another.

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Digitising this kind of "fundamentally flawed" advice "just makes the mess bigger, quicker", he said.

"Digitisation of a completely different kind, however, is the future of financial advice for ordinary, non-affluent Australians," Mr Kolbusz said.

This would involve automatically generating a personal plan for every account managed by an institution, he said – "a real-time plan is generated digitally and tailored to the life stage of the account holder".

Mr Kolbusz acknowledged the financial plan would be limited to a single account, but this would not be a problem if the client only had one provider that they trust.

"In this new world, institutions will compete for assets under management based on the ease, clarity and transparency of the real-time financial plans they offer with their products," he said.

"They will always be free, of course. And they can be free because they will be 100 per cent digital, which means all the back-office support can also be 100 per cent digital, even the compliance audits.

"If an institution does not offer real-time financial plans as part of their product, then they will wither fast. If their underlying fees are not competitive then their own real-time financial plans will expose that."

With complete digitisation would come complete "traceability" – and the regulator, consumer and institution would be aligned, Mr Kolbusz said.

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Decimal pushes for free, real-time advice
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