The Role of Robo-Advisors in the German Banking Market – Critical Analysis on Human Versus Digital Advisory Services
Our research paper aims to assess the role of robo-advisors in the German banking market. We stress Germany as target market because there is only little academic literature existent, especially when compared to Anglo-American sources. In our research, we begin by conducting a (i) literature-review and examine main aspects of relevant and latest research results. Secondly, we use (ii) descriptive statistics on a quantitative data base of the isf Institute for Strategic Finance (n=1911). Based on the combined intermediate results from the document analysis and survey statistics, we conduct (iii) semi-structured expert interviews (n=18) with high-ranked representatives from banks, asset managers, robo-Advisors and management firms to thoroughly research the chances and challenges of robo-advice for the German market. The key finding implicates a relevant future role for the digital offering, but current market players fail to offer adequate services and market strategies. There are numerous existing limitations we reveal in our paper (e.g. individuality, cultural bias, artificial intelligence), which are still constraining the full potential of robo-advisory and ultimately confirming the sluggish acceptance and perception by German investors.
Keywords - Robo-Advisor, Digital Wealth Management, Digitization, FinTech.