The Financial Conduct Authority will soon have to recognise “the reality on the ground” and allow advisers to communicate through chat services like WhatsApp, according to technology experts.
Speaking at today's (6 September) Fintech Conference of the Personal Investment Management and Financial Advice Association (Pimfa) a panel of technology experts addressed how clients would soon expect their advisers to communicate with them in different ways.
Douglas Orr, chief executive of messaging platform Novastone, said the use of email in Asia is already becoming redundant in favour of services like WhatsApp and WeChat.
He said email is “dead” and UK regulators need to recognise this.
He said: “The Singaporean authority came out with their new ruling earlier this year that you can use WhatsApp and WeChat but you need to do it in a secure way and record the conversation.
“That is not the case with the FCA but the Singaporean authority has been driven by the client in Asia, the reality on the ground, and that will probably become our reality soon.”
Freddie McMahon, co-founder of chatbot provider DF2020, said financial services were moving away from being supply-driven to demand-driven, meaning advisers would have to communicate in the way their clients want.
Rob Hemphill, head of innovation at Coutts, said the private bank is looking at how it can change its communication procedures.
He said: “The reality is for us email is not dead but we don’t use it for any kind of instruction. It is dead from that perspective. It would be great for us to be in that position.
“We still use it for a more broad communication that will be dead to us soon as we move towards much more personalisation.
“We realise that it is not that effective.”
But Mr Hemphill raised concerns about the use of services like WhatsApp, saying it is not an auditable form of communication and that the conversation cannot be recorded.
Earlier this week, research by Intelliflo revealed advisers are putting themselves at risk by using social media, with fewer than half of firms having written policies about using sites such as Facebook and Linkedin.
Inteliflo’s fourth annual survey 365 users of its software in July and August of this year found that Facebook is growing in popularity as a site for advisers to use for business with 41 per cent using the site for business, compared with 36 per cent in 2016.
In March 2015 the FCA tackled the growing use of social media among financial advisers.
The FCA has stated that it is ‘media neutral’ so social media is viewed as any other type of communication.
As a result, intermediaries such as Tenet recommend social media is treated in the same way as a company brochure or website and is approved by an appropriate compliance officer.
Tenet states a demonstrable social media policy should be in place and a record of all social media activity should be kept.
The FCA’s March 2015 guidance also deals with the use of risk warnings on social media and the use of hashtags and re-tweets, which is covered indepth in a later article in this guide.
To learn more about the FCA's current rules on the use of social media, and earn 60 minutes of CPD, click here.
damian.fantato@ft.com
