The UK robo-advisory market has crossed a landmark threshold, with combined assets under management surpassing £50 billion for the first time in the second quarter of 2025, according to data from the Investment Association. The milestone represents a fourfold increase from £12.5 billion in 2021, driven by a combination of rising retail investor confidence, improved algorithm performance, and growing disillusionment with the fees charged by traditional wealth managers. Nutmeg, the JPMorgan-owned platform, remains the market leader with approximately £18 billion in AUM, followed by Wealthify at £9.2 billion and Moneyfarm at £7.8 billion.

The growth has been particularly pronounced among investors aged 25 to 40, a demographic that now accounts for 64 per cent of new robo-advisory accounts. "This generation grew up with algorithms curating their music, their news feeds, and their shopping recommendations," said Lisa Chen, chief executive of Wealthify. "Trusting an algorithm with their investments is a natural extension of how they already interact with technology." The platforms have also benefited from regulatory changes, with the FCA's Consumer Duty rules pushing traditional advisers to justify their fees more rigorously, making the typical robo-advisory charge of 0.25 to 0.75 per cent increasingly attractive by comparison.

Not everyone is convinced the trend is entirely positive. Baroness Altmann, the former pensions minister, warned that robo-advisors risked creating a "false sense of security" among inexperienced investors who may not fully understand the risks of equity exposure during market downturns. "An algorithm can optimise a portfolio, but it cannot hold your hand during a crash," she told the House of Lords Economic Affairs Committee. Industry leaders have pushed back, noting that several platforms now incorporate behavioural nudges and risk-tolerance reassessments during periods of heightened volatility, features that traditional advisers rarely offer at scale.