Advisers should embrace the best elements of artificial intelligence, rather than fear being replaced by it, according to the chief executive of Dynamic Planner.
Ben Goss said as the financial services world considers the various ways in which technology such as machine learning and generative AI can be used, it was important not to write off the human element of the advice process.
He told FT Adviser: "Without a doubt, GenAI is a powerful technology and, over the mid-to long-term, could do many things.
"But in terms of financial advice, it is not there yet - it cannot yet approximate the same sort of nuanced decision making that advisers do with the consistency, accuracy and explainability that a regulated process requires."
As reported by FT Adviser earlier this year, some technology specialists have warned that paraplanners and advisers could find themselves on the wrong side of the 'fourth industrial revolution' if they fail to engage with AI and machine learning.
But Goss said he did not believe the world of AI was ready to replace advisers - at least, not yet.
Not only is there the need for that crucial "human element" and empathy, but there are inherent issues with generative AI that do not seem to have been fixed, such as the issue of hallucinations.
He explained: "With GenAI there are still too many instances of things such as hallucinations, and you still need the human in the loop. Take transcription services for example - we still need humans to look at the scripts and spot errors.
"The issue is that GenAI is essentially built using probabilistic models to come up with what appears to be a reasonable judgement, but it might not be absolutely accurate or provide the most appropriate answer. Or, it might just be plain wrong.
"So I don't think GenAI can replace advisers - not yet anyway, and not in the near future."
Best use cases
But there are opportunities to embed machine learning into the advice process to make things easier, more efficient and effective for advisers. It can help analyse data and help determine things such as investor behaviour or risk models.
Goss said: "[There is ] absolutely a role to play for augmented intelligence at every step of the process. For example, during the client onboarding process, you can use machine learning and AI to help summarise meetings and fill in forms.
"It can also help with the behind-the-scenes admin: form-filling and checking; getting information more quickly from providers; summarising long documents, testing and checking client profiles; and using and analysing data to enable customers to get the content and information that is personalised and relevant to them."
He said Dynamic Planner was "very excited about the possibilities that stem from big data".
