Younger generational groups, in particular Millennials, are significantly more open to receiving automated financial advice and investment management than their elder counterparts.

Crealogix commissioned a survey of 1,200 consumers aged 16 and above at the end of July, finding that more than 60 per cent of those aged between 30 and 37 stated they would be receptive to an automated financial service, rising to almost 70 per cent of those aged between 22 and 29.

The digital banking solutions provider also found that as age increases, consumers are increasingly likely to express resistance to a service described as based on software rather than human interaction.

The Generation X demographic, while more open to the idea of robo-advisory services than baby boomers, are still relatively resistant, with only 40 per cent in favour between ages 46 and 52.

This figure rises to 50 per cent among the younger Generation X of 38 to 45 year olds. By comparison, 68 per cent of younger Millennials between 22 and 29 were receptive to automated investment management.

A robo-advisory service is based on predefined business logic that learns and responds to investors’ circumstances, preferences and goals. Questions and recommendations are delivered interactively through a website or mobile app, so a service does not require intervention by a human advisor for an investor to create or edit their investment profile and orders.

The different age brackets were much more in agreement in their perceived value of face-to-face time with human advisors, with 40 per cent of respondents considering it as the most important feature of using a professional wealth manager.

Crealogix suggested that this represents an opportunity for wealth managers to combine their digital offering - which appeals to younger people - with a more traditionally valued face-to-face service, while underscoring the risks of interpreting ‘digital first’ as ‘digital only’.

Jo Howes, commercial director at Crealogix, said there is a growing interest in digital-first financial services, particularly among tech-savvy young people, and most new brands rely in some way on robo-advisory approaches.

“As demand for interactive, self-service investment services grows, wealth management firms are recognising that they can exploit this technology to gain relevance in the eyes of younger clients, as well as remain competitive with their existing customer base,” she stated.

Similar research from consulting firm Altus looking at how Open Banking technologies are likely to be embraced also found that Millennials are the generation most at ease with such solutions.

Over half (53 per cent) of 25-34 year olds would be happy to allow a web-based service to review and manage their personal finances, compared to 35-44 year olds (51 per cent), 45-54 year olds (47 per cent) and the over 55s (38 per cent).

However, 85 per cent of Millennials said they would expect this to include the option of speaking to a person, either through a webchat or over the phone as they were making the decision to invest in a new product.

Simon Bussy, director of wealth at Altus Consulting, said: “It’s interesting to see that, whilst the younger generation is open to managing their personal finances online, they are more likely to expect, and want, a human interaction as part of this offering.

“We still live in a world where many people still like the reassurance of speaking to a human during the decision-making process, and I don’t expect that to change any time soon.”

FStech took a deep-dive into the robo-advice market earlier this summer, finding that some smaller startups are struggling with client acquisition, while established wealth managers have been slow to embrace younger generations.

Lisa Caplan, head of financial advice at Nutmeg - one of the first of the new online wealth managers in 2012 - commented: “We believe the future of wealth management is digital and there are no signs that investors or the industry are planning on taking steps backward.”

Meanwhile, in the asset management space, incumbents are finally coming round to the benefits of a FinTech front end to bring in new asset streams.

Ian McKenna, director at the Finance & Technology Research Centre, argued that FinTechs are taking advantage of different channels and reacting to consumer demands around personalisation.

“Millennials may not have much money to invest now, but if you don’t communicate with them at this stage, then you won’t get their money once they’ve made it or inherited it later,” he added.

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