Artificial intelligence (AI) is seen as a cornerstone for the future of UK wealth management, but a significant gap in trust between wealth managers and their clients could slow its adoption, according to research from Avaloq, a provider of digital banking and wealth management solutions.
A survey conducted by Avaloq among over 300 wealth managers and 3,000 investors globally revealed that 87% of UK wealth managers view AI as essential to their future operations. These professionals are optimistic about the technology, with the same proportion believing AI will bring benefits to the industry.
However, client trust emerged as a hurdle, with 24% of wealth managers convinced their clients will “never trust AI for investment decisions”.
Key areas where wealth managers see AI’s potential include client onboarding, where 86% of respondents shared that they expect major improvements. Other promising applications included automated summaries of client meetings (65%), compliance monitoring (64%), and regulatory checks (61%). These innovations, wealth managers said, can save time and streamline services, allowing them to focus on strategic decision-making and deeper client engagement.
Despite these advantages, the research highlighted a disconnect between managers’ enthusiasm and clients’ caution. Only 7% of UK investors say they are comfortable fully relying on AI for investment advice. A larger proportion, 38%, would prefer a hybrid model combining AI tools with human expertise, while 55% outright reject any AI involvement in their investment decisions.
This reluctance stems from the traditional emphasis on human interaction in financial advice, according to the researchers. Supporting this view, Avaloq’s survey found limited uptake of robo-advisers, with just 6% of affluent to ultra-high-net-worth investors currently using them.
Artificial intelligence: From concept to reality in investment funds
Gery Zollinger, head of data science & analytics at Avaloq, said: “UK wealth managers recognise the enormous potential for AI to support them. The potential use cases are vast, from automated processes which free up more time for managers to focus on clients and strategic decision-making to streamlined analytics and cost-effective services that expand access to advice.”
Zollinger also emphasised the importance of trust: “That said, there is still clearly a way to go when it comes to bridging the AI trust gap between wealth managers and their clients. For AI to be successful from a client perspective, wealth managers need to work closely with their clients to demonstrate the value AI can bring to their portfolios, while ensuring that the use and impact of the technology remain transparent and well-understood. AI can augment the service advisers provide to their clients, but the human element will always be vital.”
As the wealth management industry increasingly integrates AI, bridging the trust gap will be critical for its widespread acceptance among clients. With the second anniversary of Chat GPT marking a milestone in AI’s evolution, the debate over its role in financial services underscores the need for collaboration between technology and human expertise.
