Roboadvice scheme calls for financial advisers

Select Investments, which is jointly owned by Crest Financial and NZ Financial Services Group have taken a 45% stake in the business to help launch a “facilitated” digital advice product targeting those who do not think about their KiwiSaver.

Crest Financial is headed by Mark Solomon. Last year the company bought Life Direct back from Trademe.

NZFSG last year acquired Kepa making it the largest dealer group in New Zealand with 1600 financial advisers predominantly in the mortgage and life insurance space.

Rupert Carlyon established Kōura in 2019 as a digital KiwiSaver advice business in conjunction with sharebrokers Hobson Wealth Partners.

Under its new ownership Kōura is launching what it calls a facilitated advice model which is a combination of digital and personal advice.

“What we are doing is we are giving mortgage and insurance advisers the opportunity to advise their clients on KiwiSaver and help them into better KiwiSaver products, leveraging our digital advice products,” Carlyon told NBR.

“They know their clients. They're working with them for years and years on different products and so they have trust and are able to help their clients into this world.”

Koura’s funds charge a fee of 0.63% (plus a $30 annual fee for over 18s) and any client who uses that additional level of service is charged an extra 0.3%. No set and forget

Under the new model KiwiSaver members will pay for advice. Its six passive funds have a fee of 0.63%, and members who use this new, facilitated advice service will be changed an additional 0.3%. (There is a $30 annual membership fee for people over the age of 18). 

The 30 basis point advice fee is paid to the adviser, however Carlyon says that Kōura was technically the facilitator.

Other KiwiSaver providers have a model where they pay advisers a trail commission.

Carlyon says a fee of 0.93% is "extremely cheap." However, newly minted default providers Smartshares and Simplicity have set their fees at 20 and 30 basis points respectively.

Carlyon says Kōura's digital offering had not taken off as only a small portion of the market were regularly thinking about their KiwiSaver.