Fintech across Europe has been growing rapidly and proving to be a strong element in not just the tech sector but across entire economies. The finance sector has been one area in which technological innovation has faltered in comparison to the e-commerce or advertising markets. However that has now all changed with the introduction of a number of robo-advisor platforms.
Fintech development has been slow in Italy in comparison to the rest of the European Union but that has started to change in 2015 with the innovation from startups such as Borsadelcredito and Jusp. One firm that has been helping Fintech development in Italy rapidly grow has been Money Farm. Money Farm is a robo-advisor platform that already has over 15,000 active users. Their robo-advisor provides a portfolio derived from ETFs that is matched to an investor’s risk appetite. It can help create a portfolio for free but on registration a fee of either 0.9% or 1.1% is charged (depending on the chosen service level).
German Fintech development is rapidly rising as it looks to catch up with the UK and US. Berlin is leading the charge with start-ups such as Mambu and Smava; however Hamburg is creeping up led by the robo-advisor platform from Owl Hub. They provide a unique service that operates investment portfolios in a similar way to a savings account. Investors can then decide how much they want to save on a weekly basis and even link their portfolios to a bank account. These are then invested into a diversified portfolio of ETFs depending on the risk appetite of the investor.
The UK has been leading fintech development in Europe with large investments into start-ups over the past 3 years. According to Accenture, around 53% of Europe’s fintech deals since 2004 have taken place in the UK and Ireland. Nutmeg and Zen Assets are two that are at the forefront of robo-advisor platforms in the UK.
Nutmeg is available for the retail British investors with small amounts of money to invest. It welcomes first-time investors and provides additional services, such as the Nutmeg ISA and personal pension.
Zen Assets, on the other hand, targets professional investors tired of paying huge fees to their underperforming flesh-and-blood advisors. It offers clients a full automated investment management service that is much more affordable than the industry average. You will pay a flat fee of 0.5% to get your portfolio managed for a year (regardless of its size). In comparison with other European robo-advisors, Zen Assets’ investment team has stronger educational and professional background. Prior to founding Zen, they have successfully managed over $1.25 bn in private clients’ funds at Goldman Sachs.
As the levels of investment in fintech continue to rise, there is likely to be an increase in the number of platforms providing robo-advisor services all across Europe. Robo-advisors are reforming the manner in which wealth management services are being offered. Of course, some investors remain skeptical about the robo advice concept. It is important to understand that every automated platform is backed by the human talent and fuelled by it. Initial investment methodology was developed by real people with solid educational backgrounds and years of practical experience under their belts. Robots are here to simplify our lives, reduce stress associated with investing and cut all unnecessary fees.