55% of Aussies would trust a robot for financial advice
A study of more than 500 consumers and business leaders around Australia has revealed that the COVID-19 pandemic has increased feelings of anxiety, sadness and fear, and changed who or what Australians trust to manage their money. People now trust robots more than themselves to manage their finances, according to a study by Oracle and personal finance expert Farnoosh Torabi.
The research formed part of a larger study of 9000 respondents across 14 countries, and it revealed that COVID-19 has reshaped the role and focus areas of corporate finance teams and personal financial advisors.
The global pandemic has damaged people’s relationship with money at home and at work. Among business leaders, financial anxiety and stress increased by 94%, while consumer financial anxiety and stress increased by 111%. Additionally, 81% of business leaders are worried about the impact of COVID-19 on their organisation, with the most common concerns including a slow economic recovery or recession (46%), bankruptcy (31%) and fear of losing their job due to financial reasons (28%).
As a result, the role of finance teams has changed impermeably; in order to adopt to the growing influence and role of technology, corporate finance professionals and personal finance advisors must embrace change and develop new skills. The study revealed that 71% of business leaders want help from robots for financial tasks, including automating finance approvals (37%), compliance and risk management (35%), reporting (31%) and budgeting and forecasting (29%).
Findings also showed that 52% of business leaders, and 33% of consumers, will replace corporate finance professionals in the next five years. The study indicates that 63% of consumers want robots to help them manage their finances by freeing up time (31%), reducing unnecessary spending (24%) and increasing on-time payments (20%).
Personal finance expert Farnoosh Torabi noted that robots are well positioned to assist with managing finances, as they don’t have the same emotional connection with money. Torabi added that this doesn’t mean that finance professionals will be replaced, but research suggests that they should develop additional soft skills as their role evolves.
“Managing finances is tough at the best of times, and the financial uncertainty of the global pandemic has exacerbated financial challenges at home and at work,” Torabi said.
The events of 2020 have also changed how consumers think about money, and have increased the need for organisations to rethink how they use artificial intelligence and other technologies to manage financial processes. The study revealed that 83% of business leaders believe that organisations that don’t rethink financial processes will face risks, including falling behind competitors (40%), inaccurate reporting (35%), more stressed workers (33%) and inadequate decision-making (31%).
With 65% of consumers stating that the events of 2020 changed how they feel about handling cash, businesses have been quick to respond; 63% of business leaders have invested in digital payment capabilities and 53% have changed their business models in response to COVID-19.
Juergen Lindner, Senior Vice President (Global Marketing) at Oracle, said that financial processes have become increasingly digital for many years, with the events of 2020 accelerating that trend.
“Digital is the new normal and technologies such as artificial intelligence and chatbots play a vital role in managing finance. Our research indicates that consumers trust these technologies to accelerate their financial wellbeing over personal financial advisors, and business leaders see this trend reshaping the role of corporate finance professionals. Organisations that don’t embrace these changes risk falling behind their peers and competitors; hurting employee productivity, morale and wellbeing; and struggling to attract the next generation of AI-empowered finance talent,” Lindner said.
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