The Joint Committee of the three European Supervisory Authorities – EBA, EIOPA and Esma – has opened up a debate about the risks and benefits of robo-advisors in financial markets.
The interest of regulatory authorities in the use of computer technology to provide automated investment advice to consumers comes as more banks pile into the market, sensing an opportunity to cut costs and take on a new generation of wealth management firms such as Wealthfront, Betterment, Personal Capital, and FutureAdvisor who are already luring away clients with the promise of no-frills, low cost, advisory services.
Steven Maijoor, chair of the joint committee, says: “Financial innovation is important and, at its best, contributes to economic growth. However, this can only be achieved and sustained where consumers have confidence in such innovations.
