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Q&A. Fintech: My Financial Advisor is a Robot

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Fintech company Moneyfarm uses cutting-edge technology as well as human financial expertise to help make investing simple, easy and cost-effective. The company also invests in artificial intelligence and machine learning and recently bought AI-driven chatbot Ernest. Directindustry e-magazine met with Paolo Galvani, co-founder and chairman of Moneyfarm.

 

DirectIndustry e-magazine: Why did you launch Moneyfarm?

Paolo Galvani: Giovanni Daprà and I founded Moneyfarm in 2011 to fill the void we saw in the investment marketplace: traditional financial advice remained out of reach for many, while existing online options lacked the benefits of affordable advice. Moneyfarm combines the great efficiencies of technology with human empathy and financial expertise to deliver cost-effective advice and investment solutions. It is a digital wealth manager that helps people protect and increase their wealth for a more secure future. Through our online investment platform, we offer advice on diversified exchange-traded fund based portfolios designed to deliver sustainable growth over time, through a range of asset classes.

DirectIndustry e-magazine: What is the technology behind it?

Paolo Galvani: We use technology to match investors with investment portfolios that are specifically built for their investor profiles. Each new customer completes a survey during the sign-up process. The algorithms we have developed in-house match each investor to an investor profile that reflects their tolerance for risk. Investors are then paired with a portfolio that is specifically built and managed by our team of investment experts to reflect the customer’s investor profile.

DirectIndustry e-magazine: What are the benefits for the user?

Paolo Galvani: It can take investors over a week to get investment advice from a financial adviser. At Moneyfarm, we reduce this process to seconds. By creating efficiency in this process, we can keep costs low and make financial advice a reality for everyone. We were also the first robo-adviser in the UK to launch a full-service mobile app, allowing users to access their investments at any time through an interface that’s easy to navigate and manage.

DirectIndustry e-magazine: How do you believe AI is improving financial services in general?

Paolo Galvani: AI is improving the financial services industry by ushering in a renewed focus on the customer. It has allowed firms to draw insights from vast amounts of transactional and behavioral data to develop portfolios and new products that are tailored to customers’ needs and will continue to be as situations change in the future.

DirectIndustry e-magazine: How would you like to see the technology you use develop further?

Paolo Galvani: Moneyfarm embraces technology to ensure we can offer personalized and low-cost investment advice to our customers. We are constantly looking at ways to improve this process. One big opportunity for the wealth management sector is Open Banking. Technology is the backbone of Open Banking, which allows people to use their spending habits and savings details to get access to more personalised and better-quality advice. This will make the planning phase of saving and investing much simpler. Moneyfarm has prepared for Open Banking by acquiring AI-driven personal finance chatbot Ernest.

DirectIndustry e-magazine: Can you tell us more about Ernest and how you expect machine learning to help your business in the future?

Paolo Galvani: We are the first robo-adviser exploring how to use chatbot technology to help individuals manage their money and investments. The Ernest technology has the ability to tap into the daily transactional behaviour of customers, and this will prove critical as Moneyfarm works to provide more personalized financial advice that considers broader spending habits.

 


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