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Will artificial intelligence ever replace the knowledge, eyes and ears of an adviser? – Brodnicki

by: Peter Brodnicki, CEO, Mortgage Advice Bureau Holdings
  • 23/10/2017
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On Friday, the regulator released its report on the first 12 months of progress for its regulatory Sandbox allowing a raft of firms to test services in a live but closely monitored environment.

On the robo-advice side, the regulator detailed a couple of the firm’s working practices and in both cases both had a human safeguard to stave off potential error or consumer detriment.

Peter Brodnicki, CEO at Mortgage Advice Bureau considers the advantages and pitfalls of automated advice and the timescales for possible implementation.


We can see that progress has been made by the FCA in terms of entertaining a more tech driven advice model, but how quickly they will adapt and accept this in the same way as traditional advice is yet to be seen.

Following on from the fintech businesses bringing their automated advice products to the market the same can be said for the ‘regtech’ products. These products effectively are a machine monitoring machines that enable companies to automate compliance, financial crime and cyber security processes to identify potential vulnerabilities and risks to trigger a response to breaches.

Are they the answer to regulating AI and automated decision making? Maybe. Some of the science behind these products is simple and effective but the question remains would they really be able to replace the knowledge, eyes and ears of an adviser?

As these products develop and become more sophisticated, companies will increasingly automate complex processes, which include decision making based on experience. This means there will be a need for more intuitive questioning and algorithms, and it could only be a matter of time before we see them starting to help the regulator, compliance functions and the advisers themselves provide a compliant and consistent service to their customers.

Longer term, I believe that technology will become increasingly important as a means of managing automated advice processes, which will become more mainstream. This is also dependent on organisations willing to share data in order to enable the machine learning and of course the regulator embracing it. Where does the responsibility sit if things go wrong? I think it will still sit with the company providing the (robo)advice and not those providing the regulatory assurance products.

The positive for me is that the FCA is looking at these solutions and consulting with the industry because taking this type of approach can only be of benefit to all concerned.

A quote from PWC which I think sums it up really is this: “AI can help people make faster, better and cheaper decisions. But you have to be willing to collaborate with the machine and not just treat it as either a servant or an overlord.”


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