The coronavirus pandemic has thrown a spotlight on how inadequate technology at financial advisory firms in the U.S. and Canada has disrupted services that advisors provide to their clients, Broadridge Financial Solutions, a fintech service provider, reported this week.
Firms that fail to address this issue could experience defections by frustrated advisors fleeing to more supportive ones. In fact, half of financial advisors surveyed said they often considered leaving their current firm for one that provides better technology tools.
Seventy-seven percent of North American advisors in a recent Broadridge survey said they had lost business because they lacked appropriate technology tools to interact with clients. Eighty-seven percent reported sustained changes in their communication and engagement with investors.
Of those who reported losing business, on average they lost 21.7% of their book, according to the survey.
“Financial advisors are reliant on their firms for technology that allows them to best serve their clients wherever they may physically be and whatever market conditions are like that day,” Michael Alexander, president of wealth management at Broadridge Financial Solutions, said in a statement.
“In the fallout from the pandemic, wealth firms are going to face increased pressures to invest in modernizing their advisor technology or risk losing their advisors to firms that already have next-generation wealth platforms.”