Building trust
Other firms are also in the process of targeting the less wealthy through technology-led robo-advice services. Embark, for instance, plans a robo launch this year through the Lloyds banking network.
Tate says he is not against such developments, but adds: "Ultimately what they're selling is their own products. So I'm a believer that independent advice is preferred, because clients can be assured that they're getting the best things for them.
"Bank advice is probably better than nothing, but it's not going to break down any advice gap at all."
He also does not think these services will help to raise trust in the advice profession.
"I see trust as a major issue in our industry. We don't like to talk about it because we're in this little bubble of the 8 per cent – well they trust us while the 92 per cent don't, and that's a big problem in my opinion," Tate says.
He notes the first step towards earning trust is to offer a service where people do not pay more for certain advice and are not surprised by hidden charges.
But Tate acknowledges building trust takes time. "One of the biggest challenges is the message that we've got and how we get that out.
"I'm starting to get that out within the industry but again, trust takes time to build. So telling people and changing people's mindsets on what they might expect from a financial adviser versus what we offer, you know, it's not something that happens overnight."
carmen.reichman@ft.com
