Investors could claim foul play if a formula fails

based – aimed, for example, at someone who has a lump sum from an inheritance or redundancy that they want to invest. They don’t deal with mortgages or insurance.’

Alastair Rush, founder of Fiver a Day, a robo-advice service that launched last month, says: ‘We are for people with simple financial needs.’

Most services will deal only with clients who are building wealth, whether in Isas or pensions. They are not interested in the complex decisions of turning a lump sum into retirement income, for example. Rush says: ‘People probably need to see an independent financial adviser, face-to-face, for that.’

Polson says: ‘A robo-advice system makes recommendations but it is nothing to be afraid of. It’s not Skynet – the evil artificial intelligence network in The Terminator films. There are usually responsible humans behind it.’

DANGERS LURK

THE boss of the Personal Finance Society, a body that embraces 26,000 professional financial advisers, many with chartered status, fears robo-advice could trigger a new mis-selling scandal.

Keith Richards says: ‘Most roboadvisers use algorithms to arrive at formulaic investment outcomes, which may not always be right for everyone. There is a likelihood that some investors could claim foul play in the future if the formulas start to unravel.’

But Fiver a Day’s Rush claims the risks involved in such advice are no greater than from seeing a human adviser. He says: ‘You hear stories of people getting bad faceto-face advice all the time. What robo-advisers need to do is make sure they turn down people who should not be investing.’

THE HUMAN TOUCH

DESPITE the onset of robo-advice, many investors will still prefer to talk through their finances face-toface. For those seeking an adviser, the Personal Finance Society has just launched ‘yourmoney’, a list of 22,000 advisers at thepfs.org/yourmoney/.

Advisers do not pay to appear on the register, unlike at rival adviser websites. For example, Unbiased (24,000 advisers) charges nothing for a basic listing, but advisers who want a higher profile pay a monthly fee. Vouched For also charges advisers, solicitors and accountants that appear in its top-rated listings.