Decimal Software’s white label robot financial adviser platform now has more than $3 billion in funds under advice.
The latest $1 billion was gathered since December, according to a market update today. The first $2 billion came in the six months since it was launched in June last year.
The growth came without an official marketing launch for the robotic adviser on investments, superannuation, insurance and loans.
Robo advice promises lower overheads for financial services companies. And for those making investments online, there’s no comfortable chat with an adviser but, hopefully, it means lower fees.
Decimal Software CEO Nic Pollock says real people are using cloud-based robo-advice in Australia.
“We’re the only B2B robo operator in Australia that is delivering a white label solution now,” he says says.
“Our technology enables banks and financial institutions to offer an automated financial advice to their customers across multiple topics from investment, insurance, to superannuation and retirement.”
In an online investment environment, there is usually human intervention at some stage to complete a transaction. However, robo advice means that the consumer drives the process without contact from a human adviser.
In Australia, 80% of the market still doesn’t receive any form of financial planning advice.
“So that’s where the real potential lies with an anticipated total of $2.3 trillion in funds under advice.”
Pollock says robo-advice is not about displacing human advisers.
“In the first instance, it’s about offering the customer choice in the way they engage and then helping the banks and other financial institutions address those customers in a highly scalable and cost efficient manner,” he says.
“While there is still a small amount of reasonable caution in regards to where robo-advice fits in the market, the fact is that industry has embraced the opportunity and started moving forward with it.”
In its latest half year results, Decimal Software posted a $4.14 million loss. The company announced a capital placement for 50 million shares at $0.07 in November 2015 to raise $3.5 million.
In December, Decimal and Mercer signed a new contract for a white label advice platform via 170 Superannuation fund customers, a potential audience of 600,000 users.
Mercer will be launching the service in the second quarter of 2016.