You may have heard the saying ‘don’t put all your eggs in one basket’ and for investing the fear of losing money is one of the reasons why many people put their money into different investments. Think of your imaginary eggs going into a series of baskets to help reduce some of the risk.
Diversification of risk means that individuals spread money into different investments, such as equities, bonds, cash and property. The Financial Services Compensation Scheme (FSCS) also means that some investors spread their risk over several bank accounts so as to protect their money at the maximum limit of £85,000 where they would receive 100% of the compensation they are due.
Diversification also provides challenges, when you have investments across different providers, making it tricky to stay on top of them all. This is certainly true of pensions, where people now have an average of eleven different jobs during their career and are often enrolled in a new pension scheme at each workplace.
With Open Banking we have seen banks and FinTechs look to help consumers with the challenges of diversification by providing connectivity to their different accounts from different providers to give an aggregated view of their financial affairs.
This is now even easier as Envizage, a simulation-based holistic advice engine has integrated Moneyhub’s Open Banking APIs. This allows our clients to build their own branded applications using these integrated APIs.
Vinay Jayaram, CEO of Envizage states “We are seeing more of our larger clients look at ways to think holistically about the advice they offer their end consumers. They recognise this can only happen when they can see the full picture. Envizage puts all financial products in the context of a customer’s future life goals.”
Sam Seaton, CEO of Moneyhub adds: “We are delighted that Envizage has integrated our Open Finance APIs. Not only does this help provide visibility to users’ finances, but it also adds real-time highly personalised insight. This means managing money is easier, it works harder and goes further. We call this frictionless finance.”
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