RBS cuts hundreds of jobs as FCA approves ‘robo-advisers’
Wed 16 Mar 2016
Royal Bank of Scotland (RBS) has announced that it will be switching customer advice services over to automated ‘robo-advisers’ as it cuts 220 face-to-face positions.
Given the green light from UK regulator, the Financial Conduct Authority (FCA) this week, the bank agreed that the move would lead to cheaper, more accessible financial advice.
‘Our customers increasingly want to bank with us using digital technology. As a result, we are scaling back our face-to-face advisers and significantly investing in an online investing platform that enables us to help a new group of customers with as little as £500 to invest,’ RBS said in an official statement.
Those customers qualifying for personalised advice will now need to have at least £250,000 to invest.
The new online service will allow customers to log onto internet banking and receive free, tailored financial advice after answering a number of questions – expected to include ‘What are you saving for?’, ‘How much have you got to invest?’, and ‘How long do you want to invest your money for?’
Having conducted a seven-month review, the FCA and the Treasury concluded that introducing the bot technology could ‘play a major role in driving down costs.’ They found that consumers generally did not want to pay for fully regulated advice, but rather have access to more informal guidance. The FCA also considered establishing a new advice unit to support financial firms in setting up automated ‘robo-advice’ schemes.
‘The package of reforms we have laid out today will help increase both the accessibility and affordability of the advice and guidance, to ensure that consumers get the help they really need when they really need it,’ commented FCA acting chief executive, Tracey McDermott.
Following the FCA’s recommendations, it is expected that other UK banks will soon introduce similar ‘robo’ services.