RBS Cuts Hundreds of Jobs As FCA Approves 'Robo-Advisers' (thestack.com)

An anonymous reader writes: 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. Those customers qualifying for personalised advice will now need to have at least £250,000 (approx. $350,000) to invest. Following the FCA's recommendations, it is expected that other UK banks will soon introduce similar 'robo' services.

Comments

It's about time we realize

[iserlohn]

Blind allegiance to profit is causing society's downfall.

Re:It's about time we realize

[Richard_at_work]

This is very very little in difference to the current concept of quote engines in the insurance industry where the resulting quotations are classified as "non-advised", meaning there is no opportunity for them to be miss-sold as the entire onus is on the purchaser and not the seller to ensure that what they are buying is correct for them.

In the UK the financial and insurance industry is heavily regulated, to the point where the authority will take something which has been deemed "acceptable activity" for many years and force the industry to refund premiums - the banks are currently in the tail end of refunding over £100Billion in Payment Protection Insurance premiums (and interest) because the FSA (now the FCA) suddenly deemed the way they were sold to be non-acceptable.

So, RBS is just using standard rating systems to present standardised options for low capital investors on a non-advised basis.

Re:How are they going to justify MER?

[__aaclcg7560]

Majority of people are financially illustrate [...]

I'm sure the new robo advisors will provide crayons for customers to draw pictures while their pockets are picked clean.

Funny thing

[MrKrillls]

I have no idea how well or badly the low end investor will be robo-advised ar RBS, but I'm pretty sure that a few pieces of financial advice, that could practically be dispensed on one side of a small piece of paper, would be the core of excellent advice for 99.9% of everyone.

Set aside a little to invest on a regular schedule.

Don't sell on market panic. Instead, consider purchases.

Stick with simple, low cost diversified instruments.

And so on.

A robot could do the majority. My concern is the folks with unusual circumstances who need differing advise, or more handholding.

Re:Funny thing

[BarbaraHudson]

The human advisers have no skin in the game - they make money whether you do or not. At least with a robo-adviser, you'll pay less in fees.

Thin end of the wedge

[Coisiche]

Next up, perhaps, "robo-lawyers". Just for the poor people, obviously. There will be a minimum threshold to qualify for human lawyers as we diverge further into there being "one law for the rich".

There will be a minimum financial threshold for more and more things. "Doctor" Watson for the poor, human doctors for the rich, etc.

Income inequality growth related

[millertym]

Outside of the just the concern about robotic systems replacing formerly human jobs is the expanded conversation about growth in income inequality. You know the board of directors aren't going to AI themselves out of their jobs. At least not before everyone else is. Which means all that same corporate profit is funneling to fewer and fewer people.

If there is going to be a serious discussion about how to try to keep free, modern cultures in a healthy state in relation to income inequality, then automation needs to be a part of that discussion.