The Royal Bank of Scotland [RBS] has announced it will be switching customer advice services over to “robo-advisers.” The company was given the green light from UK regulator, the Financial Conduct Authority (FCA), with the hope that the switch 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.”
Unfortunately for RBS employees, “scaling back face-to-face advisers” means human employees are being fired— 220 adviser positions have been eliminated, to be exact.
Not in the mood to chat with a robot about your financial matters? No problem—well, as long as you have £250,000. Customers now have to express interest in investing at least this amount before they qualify for personalized robot advice.
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.”
“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.
If you’re into cyber-security, some red flags might be popping up. But have no fear—the FCA is considering establishing a new advice unit to support financial firms in setting up automated “robo-advice” schemes.
Let’s hope that works out, as following the FCA’s recommendations, it is expected that other UK banks will soon introduce similar robo-services.