The founders of Cavanagh Group have teamed up again to launch a robo-advice service they say will disrupt the financial advice market with a second generation automated offering.
Simon Redgrove and Andrew Fay have founded Munnypot, which launches in the autumn providing both an investment service and regulated financial advice.
The duo were involved in founding Cavanagh Group and were respectively managing director and chief executive when it was bought by Close Brothers in 2011.
Mr Fay said: “The first generation of robo-advice services were, frankly, too robotic and failed to actually give people advice.
“Munnypot is aiming to change that by creating a more natural, intuitive experience that delivers actionable advice, rather than vague recommendations.”
Users of Munnypot will answer questions about their life goals in a “conversational style” and can then “play” with different scenarios to understand how their finances could be affected by different decisions.
It will provide restricted advice on the best way a person should invest their money through one of five tracker products, according to its founder, keeping its clients informed on performance and advising them on possible decisions if things change.
The service has a minimum investment of £250 and there will be a platform fee of 0.35 per cent plus a 0.4 per cent fee for ongoing advice and servicing.
Mr Redgrove branded the UK’s current system of financial advice “profoundly unfair and must change”, adding that “millions are bamboozled by the variety and complexity of financial products on the market.
“The financial service industry profits from this, charging sky-high fees for advice, whilst often failing to outperform the market.
“We’re on a mission to make financial advice affordable and accessible to all, so that their money works harder for them.”
Munnypot is backed by SEI Wealth Platform, which provides outsourced investment operations, trading, custody and settlement services.
Brett Williams, managing director of SEI Wealth Platform UK Private Banking, suggested that as a consequence of the Retail Distribution Review, there has been an increase in demand for automated advice solutions to help those customers who are no longer being served by advisers.
“We are delighted to be partnering with Munnypot, which we believe will be a disruptive brand in the UK market and think the company’s user experience, mobile-first design and simplicity will greatly appeal to a broad range of consumers, not just the tech savvy mass affluent millennials,” he added.
