How AI is upending the financial advice market

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This week we're delighted to be introducing a new investment Drop to Shuttle members: an AI-powered fintech building infrastructure for the financial advice industry, the layer that lets an adviser, human or machine, actually see a client's full financial picture. It's a market where most consumers can't get personalised advice, not because advisers don't want to serve them, but because the systems they use can't scale to it. With open finance regulation now rolling out across more than 60 countries, the economics of the whole industry are about to change, and this team is building to capture that shift.

The CEO is a Certified Financial Planner and former stockbroker with 15 years across trading, advisory and operations, who automated her own role twice before building the product she always wished she'd had. The CTO is a second-time founder with more than 10 patents, from senior open banking roles at Mastercard and two of the biggest open finance acquisitions the industry has seen. A domain founder paired with a technical founder, both carrying real scar tissue from the problem they're solving. That's the combination we look for.

They're not starting from zero: pilots completed with advisory firms, inbound demand from wealth managers across Ireland and the UK, and a pipeline forming ahead of full launch later this year. The round is backed by a well-known fintech VC whose portfolio includes Monzo and GoCardless. If you would like to take part, you can top up your account or sign up using the link above.

Now, let’s get into it 👇

The FCA eyes up AI-led financial advice

At the start of this week the FCA published the Mills Review, a 147-page study of what AI will do to retail financial services by 2030, commissioned by the FCA Board and led by executive director Sheldon Mills. Its central finding: AI will transform retail financial services by 2030, and the current rulebook was not built for it.

Ahead of publication Mills told the Financial Times the regulator should decide within three to six months whether general-purpose models such as ChatGPT, Claude and Gemini fall inside its remit when they give financial guidance. Today they sit entirely outside it. He called the position an arms race and recommended new powers under the Designated Activities Regime, closer oversight of autonomous AI, and a trusted public-interest AI guidance service.

The demand is measurable. The FCA found around 11 million UK adults, one in five, would let an AI make financial decisions within limits they set, and 16% already use AI for financial tasks; Finder puts the share who have used AI for some kind of financial advice at 40%. The review doesn't ask whether AI should give advice. Consumer behaviour has already settled that. It asks how to regulate what is already happening at scale.

The economics of the financial advice

In the UK, only 9% of adults receive regulated advice in a given year, and the FCA estimates 8.6 million more would benefit but don't get it, priced out of a service perceived as being for higher earners. Britain is not an outlier. Across the EU just 17% of household assets sit in investments at all, against 43% in the US, with 45% of European investors doubting the advice they do receive is in their best interest.

Since the Retail Distribution Review banned commission in 2013, advice has been paid for directly. The FCA puts the average initial charge at 2.4% of the sum invested and ongoing advice at 0.8% a year; firms such as Hargreaves Lansdown set minimum fees near £995. The average advised client has more than £150,000 under advice. The Schroders survey found the share of financial advisers willing to take clients with under £50,000 halved from 53% in 2019 to just 25% in 2023, and one in five won't take a client with under £200,000 in savings. The economics forced the industry up-market, meaning everyone below the threshold is turning to more accessible advisers in the form of chatbots, whether a ChatGPT, Gemini or Claude subscription.

The FCA's answer to this is targeted support, a middle tier between free guidance and full personalised advice, letting firms help people at scale without the full cost of the advice regime. The difficulty is calibration. Guardrails strong enough to protect consumers can easily end up heavy enough to reintroduce the very cost and caution that priced people out to begin with.

What AI is already fixing

AI's first job in financial advice is demolishing the admin that made advice expensive in the first place. UK advisers and paraplanners spend 10 to 15 hours a week on suitability reports, close to 40% of their working time. A report that took four to six hours by hand is now produced in under an hour by tools such as AdvisoryAI and Aveni, with vendors reporting around 40% fewer compliance corrections on the AI drafts. About 70% of advisers already use AI to transcribe client meetings, and 94% told Dynamic Planner's 2025 survey they expect AI to improve the profession, a sharp reversal after a decade fearing robo-advice.

Strip most of the cost out of serving a client and the economics that priced out the sub-£50,000 saver start to reverse: an adviser who can handle twice as many clients can profitably take on the people those thresholds shut out. The startups that collapse advisers' cost to serve, and hand them back the capacity to take on more clients, are the ones positioned to win here.

Open banking is delivering greater transparency, speed and accessibility

Even a fully authorised adviser, human or machine, can't simply see a client's pensions, investments and policies. That data sits with product providers and is released only against a signed Letter of Authority, posted or emailed, then returned as PDFs that someone at the firm rekeys by hand. This can take anywhere between two to six weeks, and a client with several old pensions needs a separate letter to each provider. Open banking was designed to address the accessibility, and speed, of which our own financial information can be processed across different providers.

Open banking began with a 2016 Competition and Markets Authority report finding that the largest UK banks didn't compete hard enough and smaller rivals couldn't break in. The CMA's remedy was to order the nine biggest banks, the CMA9, to let customers share their own account data with other regulated firms through standardised software connections called APIs. The legal framework came from the Payment Services Regulations, which brought the EU's PSD2 directive into UK law, and the first bank APIs went live in January 2018.

With your explicit consent, an FCA or CBI authorised firm can read your current-account data directly from the bank in seconds, no login handed over and nothing posted. That is what sits under account aggregation in budgeting apps, affordability checks in lending, and pay-by-bank at checkout: 145 authorised providers and around 17 million active users, on the FCA's count.

Open banking covers one thing, the current account. Pensions, investments, insurance, mortgages and debt sit outside it, which is why an adviser still needs a Letter of Authority for them. The long-term money that decides whether you retire comfortably is the part still behind paper.

How open finance goes further

Open finance applies the same consent-and-API principle to what open banking left out. In April of this year the FCA published its Open Finance roadmap, to extend secure data sharing across pensions, investments, insurance, mortgages and debt by 2030. Open Banking Limited and EY put the combined economic impact at £7.4 billion a year within five years.

A recurring criticism is speed. A 2029/30 delivery date is slow for a technology that redraws itself every six months, and the EU is slower still, its Financial Data Access regulation stuck in trilogue negotiations between the European commission, Parliament and Member States. But the direction is fixed, and the pipes already pay where they exist: Mastercard and Saxo Bank run an open-banking funding flow for investment accounts in Denmark that lifted new fund inflows by 20%. Startups and incumbents that can build the consent-and-connectivity layer for pensions and investments could reap significant rewards from structural changes by the end of the decade.

Where the VC money is going

Capital has already picked a side, and it is not the consumer-facing one. In the US the cheques are biggest: Wealth.com closed an oversubscribed $65 million round in April for AI estate and tax planning, backed by Charles Schwab, GV and Citi Ventures, while Avantos raised $25 million in February for an AI layer connecting custodians, CRMs and portfolio tools, with Vanguard, SEI and Guardian Life joining as investors and clients.

The same thesis is being funded closer to home. Edinburgh's Aveni, which builds AI tools for advisers and wealth managers on its own UK-trained models, raised £12 million in June backed by Lloyds Banking Group and Nationwide, and UK fintech as a whole drew around $3.6 billion in 2025 on Innovate Finance's count. In almost every case the money is funding the adviser's data and workflow layer, not another consumer robo-adviser: that 2010s experiment taught an expensive lesson about acquisition costs eating small-account margins, which is why Nutmeg was still loss-making when JP Morgan bought it in 2021.

The infrastructure layer tends to capture value quietly. In open banking's first cycle the consumer brands mostly struggled while those building the infrastructure and data rails accrued most of the value. Visa agreed to buy the US data-aggregator Plaid for $5.3 billion before antitrust blocked it, then bought Europe's Tink for €1.8 billion instead. Most people in Europe have never heard of Tink, but its financial data infrastructure indispensable to the larger consumer providers that build on top of its systems.

What this means for investors

The scarce, expensive input in financial advice was always the data: the full view of a client's pensions, savings and circumstances that turns a generic recommendation into a personalised one. AI has driven the cost of the reasoning close to zero and, on the FCA's own reading, is on course to become how most people get financial help by 2030.

The last data-infrastructure cycle was unkind to the obvious bets. The budgeting apps and robo-advisers consumers actually touched mostly struggled, while the companies that won sat unseen between the banks and everyone building on top of them. Open finance is about to run that experiment one layer up, across pensions and investments, and the winners will likely be those enabling the infrastructure and data rather than those building the consumer apps. That is where tomorrow's Drop sits: the consented-data layer an adviser, human or machine, needs before any of the intelligence is worth anything. The specifics, from the team to the terms, will be live on the Shuttle platform tomorrow. If you would like to take part, top up your account or sign up using the link at the top of the article.

What we’ve been working on at Shuttle

• Opening our next investment Drop for members tomorrow 📥

• Working on supporting accredited US investors and US dealflow 🌎

• Preparing our new video content series 👀

The Unsophisticated Investor is brought to you by Mark, Head of UK Expansion & Operations at Shuttle. Shuttle's mission is to break down the barriers to private markets and make wealth-building opportunities accessible beyond the ultra-wealthy elite. To do it, we're building Europe's private market infrastructure platform for running investment operations. By stripping away the legal friction and admin for deal managers, we make it easier than ever for high-performing opportunities to open up to a wider, modern network of investors.

Mark
Shuttle’s Head of UK Expansion & Operations