Robo advice shines for loan applicants
The average borrower's propensity to pay for robo-advice on their loan is larger than the financial advantages such guidance gives, according to the Financial Conduct Authority.
City watchdog reported that of the 3,423 adults it polled, 22.8% received paid robo-advice recommendations; however, this group's average willingness to pay was only 60.1%.
The regulator stated, "This result demonstrates that consumers who were asked to offer a value for the robo-advising tool in our setting valued...
it more on average than the monetary benefits that the robo-adviser actually supplied.
These monetary advantages included interest and fee reductions.
The FCA said that the findings might be related to customers' "excessively gloomy" perceptions of their independence in carrying out loan repayment tasks.