A former CBA executive has warned that robo-advice is likely to become a channel that further expands the vertically-integrated banking system in Australia.
SelfWealth founder and managing director Andrew Ward told Mortgage Business’s sister publication InvestorDaily that the adoption of robo-advice by major institutions is "going to take off" in 2016.
"It could be just a few years until computers are able to give comprehensive financial advice," Mr Ward said.
"But there are obstacles. Offerings like ones from the major banks could end up just pushing people further into the vertically-integrated banking system."
Mr Ward said that because customers are expensive to onboard for most robo-advice offerings, business-to-business (B2B) would be a hotly contested space.
"B2B is going to make or break robo-advisers in 2016. The cloud is becoming ubiquitous and everyone will have great user experience and user interface and great data feeds.
"The two underlying things that will win the race are the value proposition and the distribution network.
"This will mean more deals with institutions and even small-to-medium businesses," he said.
In November Macquarie Group revealed that it will launch a computer-generated advice service that will offer "customised advice" to consumers across several asset classes.
A statement by Macquarie said 'OwnersAdvisory' will operate under a flat fee-for-service model.
It will offer advice across standard asset classes, cash, fixed income, equities, commodities and alternatives – all based on an investor's profile, goals and risk appetite.
[Related: Aussie banks adopt Google technology]