• Business News
  • Shows
    • Daily Show2+2=5Take it EasyRed AlertFormula GuruMoney GyanMoney CentralMoney timeJhatpat
    • Weekly ShowMoney ComicsEconomicomRealty CheckSmile and payMoney TalesSpend WiseCompanynama
  • Insurance
  • Savings
  • Loan
  • Stocks
  • Mutual Funds
  • Real Estate
  • Crypto
  • Tax
    • हिन्दी
    • తెలుగు
    • मराठी
    • বাংলা
    • ગુજરાતી
    • ಕನ್ನಡ
  • Close
  • Daily Show
    • 2+2=5
    • Take it Easy
    • Red Alert
    • Formula Guru
    • Money Gyan
    • Money Central
    • Money time
    • Jhatpat
  • Weekly Show
    • Money Comics
    • Economicom
    • Realty Check
    • Smile and pay
    • Money Tales
    • Spend Wise
    • Companynama
  • Insurance
  • Savings
  • Loan
  • Crypto
  • Stocks
  • Mutual Funds
  • Real Estate
  • Tax
  • Exclusive
  • Home » News » Investment » Need for change in robo-advisory guidelines

Need for change in robo-advisory guidelines

Physical agreements are more expensive, take longer to acquire clients, and are less convenient than digital agreements.

  • Money9
  • Publish Date - November 2, 2021 / 08:59 AM IST
Need for change in robo-advisory guidelines

The emergence of robo-advisory services has given the age-old business of managing other people’s money a technological makeover. This group of financial advisors provides advice based on digital algorithms or artificial intelligence (AI). Robotic advisors currently offer portfolio management and tax-loss harvesting as their primary services. The popularity of this algorithm-driven financial solution has zoomed in recent years.

That said, fintech firms are finding it increasingly difficult to offer low-cost investing advice via automated platforms to small-ticket retail investors, leading several large firms to abandon business plans in this space. If their activity is limited to financial planning and investment advising, Robo-advisers are subject to SEBI’s investment adviser regulations.

They would, however, be subject to SEBI’s portfolio manager requirements if they hold client assets or have the discretion to invest on their behalf. In their current state, the regulations obstruct robo-advisory services. Further, to complicate the matter, Sebi, in April 2021, provided informal recommendations requiring a physical investment advisory agreement.

Physical agreements are more expensive, take longer to acquire clients, and are less convenient than digital agreements. SEBI should permit digitally executed IA agreements. Similarly, all physical record execution/maintenance obligations in the IA regulations should be replaced with digital equivalents.

While the IA laws already allow for the electronic maintenance of records, they do not make it evident that the same can be done online (or in electronic form). For example, keeping a “signed” rationale for arriving at financial advice is a requirement that may not be practical or optimal for robo-advisory services.

In comparison to other online market services, such as selling mutual fund units and stocks, these fintech firms are obstructed by the requirement for physical agreement copies. Today India’s digital payments market is at an all-time high and growing constantly. Creating ideal conditions for the fintech industry to thrive should be a priority area.

Download Money9 App for the latest updates on Personal Finance.

follow us

  • Facebook
  • Twitter
  • LinkedIn
  • Telegram
  • Youtube
  • Instagram

also read

  • Benefits of rental bonds for tenants

    Benefits of rental bonds for tenants

  • Rental Bonds can be key to knowing your tenant

    Rental Bonds can be key to knowing your tenant

Read more news on

  • investments
  • Money9 Edit
  • portfolio management
  • robo advisors
  • robo advisory

Latest Video

SEE MORE
Nitin Gadkari proposes star ratings for vehicles

Nitin Gadkari proposes star ratings for vehicles

Updated: June 30, 2022
Fintech rules which RBI changed recently

Fintech rules which RBI changed recently

Updated: July 1, 2022
What is target price for Nifty and Sensex?

What is target price for Nifty and Sensex?

Updated: June 29, 2022
Why wheat flour prices increased after wheat export ban?

Why wheat flour prices increased after wheat export ban?

Updated: June 29, 2022
Is Petrol-Diesel price increase again on the cards?

Is Petrol-Diesel price increase again on the cards?

Updated: June 23, 2022
Why are edible oil prices falling?

Why are edible oil prices falling?

Updated: June 23, 2022
Why popular AMC stocks are down?

Why popular AMC stocks are down?

Updated: June 22, 2022
Why are car, two wheeler prices not falling?

Why are car, two wheeler prices not falling?

Updated: June 21, 2022
Open in App

Related

  • How crypto qualifies as digital gold and a better store of value

    How crypto qualifies as digital gold and a better store of value

  • The best time to act to save your tax is ‘Now’!

    The best time to act to save your tax is ‘Now’!

  • 9 things you can do to involve your family in a financial decision

    9 things you can do to involve your family in a financial decision

  • India-focused funds & ETFs see net outflows for September quarter

    India-focused funds & ETFs see net outflows for September quarter

  • Economic Survey of this year likely to be single-volume affair

    Economic Survey of this year likely to be single-volume affair

  • Financial inclusion: Social benefits

    Financial inclusion: Social benefits

Videos

  • Mahindra Scorpio N bookings to kick off on July 30
    Exclusive

    Mahindra Scorpio N bookings to kick off on July 30

  • Why wheat flour prices increased after wheat export ban?
    Exclusive

    Why wheat flour prices increased after wheat export ban?

  • RBI hikes Repo Rate, should you invest in banking stocks?
    Stocks

    RBI hikes Repo Rate, should you invest in banking stocks?

  • Which is cheapest among Airtel, Tata Play, Dish TV, etc?
    Budget

    Which is cheapest among Airtel, Tata Play, Dish TV, etc?

  • How to save capital gains tax on stocks and mutual funds?
    Tax

    How to save capital gains tax on stocks and mutual funds?

  • TV9 Sites

  • TV9 Hindi
  • TV9Telugu.com
  • TV9 Marathi
  • TV9 Gujarati
  • TV9 Kannada
  • TV9 Bangla
  • News9 Live
  • Know this india
  • Money9 Sites

  • Money9 Hindi
  • Money9 English
  • Money9 Marathi
  • Money9 Telugu
  • Money9 Gujarati
  • Money9 Kannada
  • Money9 Bangla
  • Topics

  • Insurance
  • Savings
  • Loan
  • Stocks
  • Mutual Funds
  • Real Estate
  • Tax
  • Crypto
  • Exclusive
  • Daily Shows

  • 2+2=5
  • Take it Easy
  • Red Alert
  • Formula Guru
  • Money Gyan
  • Money Central
  • Jhatpat
  • Money time
  • Weekly Shows

  • Money Comics
  • Economicom
  • Realty Check
  • Smile and pay
  • Money Tales
  • Companynama
  • Spend Wise
  • Follow us

  • FaceBook
  • Twitter
  • Youtube
  • Instagram
  • Linkedin
  • Download App

  • Andorid
  • ios
  • Contact Us
  • About Us
  • Advertise With Us
  • Privacy & Cookies Notice
  • Complaint Redressal
  • Copyright © 2022 Money9. All rights reserved.