[Newsflash n. 2]

 

Today, 4 December 2015, the Joint Committee of the three European Supervisory Authorities (ESAs) – EBA, EIOPA and ESMA – has launched a Discussion Paper on automation in financial advice to assess what action, if any, is needed to enhance the potential benefits of this innovation and mitigate its risks.

Automation in financial advice – often referred to as robo-advice – is defined as the provision of financial advice or recommendations by financial institutions to consumers without, or with very little, human intervention through computer-based algorithms.

ESA identified the potential benefits of such new tools in the “lower costs, higher consistency of advice and a bigger number of customers that can be reached”. On the other hand, the potential risks include the possibility that consumers could misunderstand advice provided to them without the benefit of a human advisor and the various types of IT failures.

The offer of automated financial advice tools is constantly growing and this could potentially change the way consumers and financial institutions interact when buying or selling financial products.

Comments to the discussion paper shall be submitted by 4 March 2016.

Please do not hesitate to contact us should you need any assistance in submitting your response or any further clarification on the discussion paper.

 

Contacts:

Vito Vittore
Senior Partner

Elena Pagnoni
Of counsel

Luigi Bonifacio
Associate