European regulators say they will continue to monitor the growth of robo-advisors but have decided not to take any action at this stage.
The Joint Committee of the three European Supervisory Authorities (ESAs) – European Banking Authority, European Insurance and Occupational Pensions Authority and European Securities and Markets Authority – on Monday published a report presenting the conclusions of its assessment on automation in financial advice.
Automated advice “is still at an early stage,” the report concludes, and is primarily concentrated in the investment sector. “The ESAs also note that financial advice in general is already addressed in various ways through a number of EU directives,” the Joint Committee says in a statement.
The regulators launched a consultation on robo- advice in December 2015 to determine “whether any action was required to ensure risks are mitigated while at the same time allowing market participants to harness the potential benefits of automated advice.”
Following that consultation, the regulators have decided to continue observing the development of robo-advice, but not to intervene in the market.
The ESAs acknowledge “the potential for growth of automation in financial advice,” and say they will continue to “monitor the evolution of the market,” to examine compliance with existing laws and regulations, and to assess the consequences of the phenomenon and its cross-border implications in their respective sectors.