The Business Times
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MIND THE GAP

Are low fees a kiss of death for robos and advisory firms?

For wealth firms with a low-fee or commission-free model, achieving scale is key, alongside patient capital

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Genevieve Cua

Genevieve Cua

Published Mon, Sep 4, 2023 · 05:00 AM
    • MoneyOwl is winding down operations, as low revenues and high operating costs made financial viability a stiff challenge.
    • MoneyOwl is winding down operations, as low revenues and high operating costs made financial viability a stiff challenge. PHOTO: BT FILE

    THE failure of robo advisory MoneyOwl, announced late last week, raises afresh a knotty question: Is a low-fee business model that’s good for investors and clients necessarily a path to failure for the service provider?

    Is this gap intractable?

    More than 10 years ago, I was a member of a panel put together by the Monetary Authority of Singapore, called the Financial Advisory Industry Review (Fair), which sought to address some key issues, including how the industry could lower distribution costs and promote fair dealing.

    Mind the GapFinancial advisoryiFast

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