Of late, banks have seen themselves competed against on many fronts — one of which is the world of investing. These days, banks are in somewhat of a technology arms race when it comes to holding investor customers' loyalty, and an army of new entrants are bringing a much more high-tech approach.
One of which sems to be the institution of robo-advice — a service popularized by businesses like Wealthfront and Betterment, which uses algorithms to generate investment allocation advice with minimal human interaction.
JPMC CEO Jamie Dimon recently noted that, in fact, Chase can offer similar services for clients looking for automated investment services or checking accounts that come with no-cost brokerage trades and that, going forward, it will offer such services as part of a future bundle of digital banking products.
“When you talk about robo and investing, well, we can do that and give it away for free if we want,” Dimon said on Thursday (June 2) during an investor presentation in New York.
“If you’re a good account, it’s no different than Jeff Bezos doing the $99 Prime and adding services to it. So, you’re always making the clients satisfied,” Dimon said, referring to the Amazon CEO. Clients with retirement accounts would be one potential target, he said.
Chase noted for a moderately enthused audience that, going forward, customers who opened trade accounts might find it comes with five to 10 free trades per month.
“We’re going to build it anyway, folks, and then, we have to decide how to price it,” Dimon said. “But we want to add these great services.”
The robo-trading announcement is a bit of a surprise, given that the bank's asset management head, Mary Callahan Erdoes, noted six months ago that robo-advisers might not do nearly so well in bear markets as they do in bull markets.
Darin Oduyoye, a spokesman for JPMorgan’s asset management division, said the bank is “committed to building a world-class digital wealth management offering.”