The advance of AI might mean UK financial services needs fewer paraplanners and some advice firms may "cease to exist" unless companies engage and get it right, according to Ian McKenna, founder of F&TRC.
Speaking at the Empowering Advice Through Technology conference at the Pullman hotel in London today (January 18), McKenna said: "AI is not going to replace paraplanners but it could do a lot of their work for them - and it might mean we need fewer paraplanners."
To counteract this, McKenna said: "My advice to paraplanners is, start becoming a data specialist.
"You have heard of the importance of clean data - so be the data person, and become the expert in your firm on the technology.
"One person who will never get fired in any business is the one who understands best how to use the technology the firm is using."
Moreover, McKenna said it was vital that advice firms used AI in a way that enhances the business and streamlines processes.
He said this might necessitate a change in business practice or a shift towards hybrid advice, to stay on top of the direction of travel.
Using AI in the manual process could take away maybe 80 per cent of the manual form-fillingPaul Miller, IWPMcKenna told delegates: "AI is not just about changing financial advice businesses. AI is going to change every single business and, candidly, those who do not embrace it are more likely to cease to exist.
"So I really urge you - we need to be looking at hybrid and digital advice."
Efficiencies
During a panel session chaired by F&TRC's Poppy Achilles, Paul Miller, chief information officer for IWP, said a working group had been set up to explore the use of AI tools, such as Microsoft's Copilot, to see how it could help make processes more efficient.
He told delegates: "Obviously we would need to make sure it is okay, but using AI in the manual process could take away maybe 80 per cent of the manual form-filling or the paraplanner's notes.
"We could use it to take detailed notes so the adviser could read it through and tweak it before giving it to the client."
He made the point there were things to investigate, such as governance and data protection, when exploring the use of AI, and that tools such as Copilot only provide a "framework", not the full product or service.
However, as there are back-end applications to AI that can potentially improve admin and streamline processes, enabling the advice firm to focus more fully on the client and regulatory obligations, Miller said it would be important to start looking at these, sooner rather than later.
According to one company attending the conference, Origo, "more and more advisers want to explore existing and emerging technologies which can help them enhance their businesses."
simoney.kyriakou@ft.com
