The annual Charles Schwab conference was held last week, with a great deal of focus on how technology is changing how investors plan and where. If one reads between the lines, this could be good news for regional banks.
Technology is important, was the consensus, but a human touch still makes the majority of investors feel more comfortable. The CEO of Charles Schwab stated, “Money is highly emotional. When you talk about emotion, it’s important to have someone to be able to be there, ask questions, build trust.”
Schwab and other discount services are leveraging technology to replace traditional financial advisors at deeply discounted fees, thus threatening the traditional model such as Merrill Lynch due to the contrast in fees and what Schwab would contend is the minimal difference in service.
Robo-Advisors may be a threat to bigger banks, but a community bank that can offer competitive fees can combine local trusted service for an appealing offering to investors. The ability to receive critical information through technology, can help bank customers do much of the heavy lifting while still trusting an expert at a local branch.