Regulatory uncertainty slows Rest digital advice enhancements

Financial advice sought by members of Rest has doubled since 2019 but the fund is hesitant to enhance its offering as they await regulatory guidance.

In a submission to the Quality of Advice Review, the fund said take-up of financial advice more than doubled in FY20 compared to the previous year. In FY21, it increased again by 10% year-on-year.

The proportion of online advice rose from 51% of all advice in 2019 to 77% in FY21, mostly from those under 40 but Rest reported a “notable spike” around the start of FY21 among members aged 40-59.

“Digital tools allow super funds like Rest to offer advice to members at scale and it allows our members to take control of their super at a time and in a way of their own choosing. It is an effective way to help more of our members make informed decisions about their super and achieve their best possible retirement outcomes.”

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However, the fund was keen to make enhancements to its digital offering in various ways but sought clarity from the regulator first around digital advice compliance.

It sought to add an enhanced data-sharing capability with MyGov and for the Consumer Data Right to consider holistic real-time data feeds of a member’s financial information. Currently, this needed to be manually added by the member.

“Integrating such valuable data into digital advice tools will also assist in addressing advice accessibility issues resulting from low levels of financial confidence or literacy, as the information would be pre-populated in the correct field.

“Clarity from the regulator on the provision of digital advice would address the current uncertainty in the industry around digital advice compliance.”

“Rest believes greater certainty of the application of advice laws to digital advice would increase confidence and in turn result in further innovation, development and uptake of digital advice service offerings.”