Following today’s news (16th May 2019) that Investec have closed their robo-advisor Click & Invest,
Sergel Woldemichael, Wealth Management Analyst at GlobalData, a leading data and analytics company, offers his view on the closure:
‘‘This latest robo-advisor termination does not mean robo-advice is coming to an end, automated service will become more prevalent in society, and learnings should be taken from Investec’s product.
“Competition in the UK robo-advice space is cutthroat, and financial planners within a bank or an IFA remain the go-to for arranging investments. Although Investec are an established global and multifunctional financial services company, Click & Invest could not find its feet in the robo-advice industry. The service had fees and a minimum deposit that were higher than the norm which would have needlessly limited themselves from a large pool of smaller scale investors.
“High net worth demand for robo-advice will increase in the future according to 65% of UK wealth managers surveyed in GlobalData’s 2018 Global Wealth Managers Survey. Unsurprisingly, these digital services are more important to the next generation than the current. Nonetheless, this does prove there is still a market for robo-advice, but robo-advisors in general may be ahead of their time.
“Although robo-advice is here to stay it will take time to cement itself. To succeed, both incumbents, and start-ups must provide a level of service and prices that meet the needs of the masses, and also consider expansions through partnerships or entering less competitive territories with high demands.”