Challenges of automated financial advice: Definition and ethical considerations

“Ethical tools and frameworks can facilitate the implementation of AIbased advice”

Consumers need to be well-informed about their financial situation to be able to take action when this changes. Automated financial advice could increase consumers’ access to financial advice and, consequently, their financial well-being. Although such advice already exists for various financial products, holistic, automated financial advice has not yet entered the market. This next step requires a definition of good automated financial advice as a basis for financial advice algorithms and a framework to consider the ethical issues involved in implementing such automated advice. Our research explores both of these challenges.

 

 

 

KEY TAKEAWAYS FOR THE INDUSTRY

• An ethical perspective must be applied to automated financial advice during the design phase to address in advance the issues that could jeopardise the adoption of automated services.
• Organisations can use the AI4 Ethical Financial Services (AI4ES) framework we developed to broadly incorporate ethics into their financial services.

Netspar, Network for Studies on Pensions, Aging and Retirement, is a thinktank and knowledge network. Netspar is dedicated to promoting a wider understanding of the economic and social implications of pensions, aging and retirement in the Netherlands and Europe.

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