The Treasury and FCA will today begin examining if so called robo-advisers can improve consumers’ access to financial advice as part of a major review of the sector.

The bodies will set out on a joint consultation as the first major milestone of the Financial Advice Market Review, which began in August.
One of the areas it will hone in on is automated or robo-advice – something which former chief executive Martin Wheatley suggested could help solve the much-debated advice gap.

The study will focus on the following questions:

• What role could technology, such as robo-advice play in improving access to financial advice?
• What kind of financial advice do consumers want?
• Are there gaps between the financial advice that consumers want, and the financial advice that they can access and afford?
• How can these gaps be closed?

The Financial Advice Market Review was launched on 3 August and is being led by Charles Roxburgh, Director General, Financial Services at HM Treasury and Tracey McDermott, acting CEO at the FCA.

Ms McDermott said: “The financial decisions people make can have long reaching effects. It is important that the market provides accessible and affordable advice when people need it.

“The review is a chance for the FCA, government, industry and consumers to work together to ensure we can deliver a market that meets this need.”

Economic Secretary to the Treasury Harriett Baldwin said it was important people can access “high quality, affordable, tailored advice and guidance to help them make informed financial decisions”.

She said this was crucial whether that related to people saving for their first home, taking out a mortgage, buying a car, or saving and investing for the future.

She said: “That’s why we’re exploring what more can be done to make sure consumers can access high quality and affordable advice so they can make informed decisions with their hard-earned money.”

The review will be supported by an external expert advisory panel comprising of industry and consumer voices, and chaired by Nick Prettejohn.

Mr Prettejohn, chair of the expert advisory panel, said: “It is vital that the financial advice market meets the needs of consumers to enable them to make informed financial decisions at all stages of their life. I am pleased to have been asked to chair the expert advisory panel of industry and consumer voices, to contribute ideas that I hope will improve consumer access to financial advice.”

The consultation will be open until 22 December, and a final report will be published ahead of Budget 2016.

The initial evidence gathering will have a broad scope before narrowing down to consider those areas where the advice gap may be most acute.