Americans Open to Robo-Advice from their Banks
Nearly one-half (46%) of American consumers are open to using robo-advice services from their banks, according to a survey by Accenture. These services would offer computer-generated advice and services without the need for a human advisor.
43% of Canadian consumers would also be interested in this service.
The “Banking on Value: Rewards, Robo-Advice and Relevance,” which surveyed more than 4,000 bank customers in the United States and Canada, found consumers would be most interested in learning how to allocate investments (79%), choosing a bank account (74%) and planning for retirement (69%).
Respondents said the primary benefits of robo-advice including speed and convenience (50%) as well as lower costs (29%). Millennials and the mass-affluent (those who have liquid financial assets between $100,000 and $1,000,000 and make over $75,000 per year) are most interested in this service.
“It’s well-known that robo-advice is gaining significant traction in the wealth management industry; however, our research shows this trend is also picking up in retail banking,” said David Edmondson, senior managing director of Accenture’s North America Banking practice. “Consumers will continue to dictate how, when and where they want to interact, and banks have an opportunity to use intelligent automation and robotics to simplify and improve the customer experience. Successful banks will strike the right balance between human and machine interaction to elevate their role in customers’ lives beyond simple transactions and become a go-to resource.”
The report also found that non-traditional banks are also gaining momentum. 11% of Americans and 9% of Canadians switched banks in the last year. Of those who switched, 33% joined non-traditional providers (online-only bank, payments provider, retailer or insurer) versus 23% who switched to a traditional regional or national bank.
“Consumers no longer view switching banks as a hassle, which puts pressure on firms to not only attract new customers, but find ways to keep existing customers loyal,” continued Edmondson. “According to our research, 79 percent of consumers consider their relationship with their bank to be purely transactional – this is a missed opportunity for banks that now have access to technology that can help them provide more tailored offerings, particularly as more consumers are open to receiving value-added services from their bank. In fact, 45 percent of consumers said the top reason they would stay loyal to their bank is if it offered discounts on purchases of interest.”