Kiwi Wealth has become the first financial services provider in the country to be approved by the Financial Markets Authority (FMA) to deliver personalised digital financial advice.
Joe Bishop, Kiwi Wealth General Manager Customer, Product and Innovation, said the FMA’s approval of Kiwi Wealth’s robo-advice application was a major step toward improving the financial future of all New Zealanders.
“Robo-advice is here. It will reinvent the way Kiwis manage their finances and give access to personalised financial advice that’s previously been out of reach for most people.”
“Now with the help of technology we aim to help members of the Kiwi Wealth KiwiSaver Scheme meet their retirement goals by providing information and advice, with the ability to implement recommendations in a way that’s flexible, intuitive, and easy to use,” he said.
Kiwi Wealth has spent the past three years developing its advice platform for its Kiwi Wealth KiwiSaver members, with its sector-leading class advice-based digital tool Future You®* already revolutionising members’ engagement with their KiwiSaver account to support their retirement planning.
“We saw first-hand what was happening globally in robo-advice and knew that we could lead its development and application in New Zealand. Being the first to receive the FMA’s approval to provide robo-advice in New Zealand is a milestone for our business. For our team, it’s an acknowledgement of all the work we’ve done, as well as our credibility and expertise in innovation,” says Mr Bishop.
“Now we can hit the go button and start to add functionality to Future You to transform it into a personalised online financial adviser.”
The upcoming Future You robo-advice release scheduled for June will give members of the Kiwi Wealth KiwiSaver Scheme personalised advice on which investment fund in the Kiwi Wealth KiwiSaver Scheme would best suit them based on their retirement income goal. The feature will be released to an initial group of members to obtain feedback, before being released to all eligible members.
“That might seem a fairly straight-forward piece of advice but it’s advice that, under current legislation, could only be given by an authorised financial adviser – a human,” says Mr Bishop.
Mr Bishop says further releases are planned over the next few months, with Kiwi Wealth planning to extend its robo-advice offering to provide holistic retirement planning advice that takes into account other assets and managing contributions to members’ Kiwi Wealth KiwiSaver Scheme accounts in line with their retirement income goals and their financial situation.
“Our goal is to provide our members with detailed and personalised retirement income planning and financial advice at their fingertips. We intend to then build this out even further to incorporate non-retirement goals such as saving for their children’s education.”
While robo-advice is here now, humans still have a key role to play in helping Kiwis build better financial futures, says Mr Bishop.
“We surveyed more than a thousand Kiwis in 2016 to look at attitudes toward robo-advising. It was fascinating to find that most people were very open to it but that they still wanted a real people available to help them with some decisions.
“We’ll always have skilled and qualified people on hand to help when people need it. But the fact is that, with more than 2.8 million Kiwis enrolled in KiwiSaver and only around 1800 authorised financial advisers available, technology is the only way to make sure everyone can get easy access to good advice.”
And humans will also have ultimate oversight of robo-advising, says Mr Bishop.
“The FMA’s exemption application process demanded we demonstrated total control and capacity – from technical expertise, software and infrastructure through to personal data security and quality assurance.”
Future You® is a registered trademark of Kiwi Wealth Limited.
*The Future You tool is available to members who are aged between 18-65 and who have not made a transfer from an Australian complying superannuation fund.
Kiwi Wealth Limited is the issuer and manager of the Kiwi Wealth KiwiSaver Scheme. The Product Disclosure Statement for the Kiwi Wealth KiwiSaver Scheme is available at www.kiwiwealth.co.nz.