Financial technology and the consumer revolution can help find better financial advice

The pressure has been rising for more consumer-friendly ways to navigate financial advice. Christopher Zinn has launched Adviser Ratings to help consumers find the planner they need.

Can the financial technology sector, FinTech, help answer the question: ‘How do I find a competent and trustworthy financial adviser?’

What happens when the energy of the consumer revolution meets the besieged and much maligned world of financial planning?

Who is best placed to bring transparency of financial planners to help restore confidence in the sector: the government, the industry or consumers themselves?

The answers to all of the above remain to be seen but I’m pining my hopes that in some small way a TripAdvisor-style rating and review service scrutinising planners might help.

It’s called Adviser Ratings and is part both of the collaborative consumption movement which pools information and services, such as Airbnb and FinTech start-ups like peer-to-peer lenders.

In financial advice there are problems: around confidence, best interests, independence, transparency, cost and most of all a consumer’s’ ability to assess quality advice.

But if we consumers could pool our information, rate and review and share our experiences of planners, suddenly the individual is armed with much more information and power to make decisions.

This is the simple idea behind Adviser Ratings. The industry know much about adviser quality and qualifications but the consumer does not usually have access to this information.

Now if enough people and planners start to contribute their comments, data and profiles it should start to become easier to find the planner you need. And now Adviser Ratings is not alone.

The sudden arrival of a number of outfits, ranging from the regulator ASIC to the retailers of financial advice, offering registers and lists of planners is no coincidence.

The pressure has been rising for more consumer-friendly ways to navigate the waters of financial advice and now we have three very different takes.

The ASIC official version coming in March will be comprehensive in terms of most details about qualifications, memberships etc but sadly lacking in the area consumers are most interested in i.e. what and how planners are paid.

On the industry-side the Westpac bank planning arm BT have launched their own Adviser View which is limited to their own staff and again provides details on qualifications, specialities and professional memberships.

Then there’s Adviser Ratings. While it might be tempting to have the power of the regulator or the funding of a big bank we have neither.

We do however come from the consumer-side of the equation seeking to use the revolution which is empowering customers in so many other areas get better results from financial advice.

We have been called both opportunist and commercial-focused in ways not necessarily endearing.

However we don’t shy away from the tempting opportunity to actually do something using the latest technologies to help rebuild confidence in a much-needed service.

Our primary focus is to drive change which benefits consumers into areas where there are contested notions of who is looking after their best interests.

While there’s no charge to consumers or planners, after gaining traction we need to hone a business model which keeps us sustainable while honouring our commitment to trust and transparency.

And we welcome the arrival of any service which can bring information consumers can use to one place to help them make better and more informed decisions.

How objective, robust or useful that information is, the way it is displayed and can be used will be fascinating to behold.

Ultimately if there’s any such thing as the wisdom of crowds, the aggregated consumer will decide and reward what is in their best interests.