Financial planning is built on trust. Clients share personal details with their financial planners, including their income, debt, investments, retirement plans, identity documents, banking information and tax details. They expect this information to be handled responsibly and kept private.
As more financial planning services move online, protecting client information is becoming increasingly important. While technology makes it easier to manage information and communicate with clients, it also creates risks that financial planners need to understand.
The Information Regulator received 2,375 reports of security compromises during South Africa’s 2024/25 financial year. The financial impact can also be significant.
According to the South African Reserve Bank’s June 2025 Financial Stability Review, the average cost of a data breach in South Africa reached US$2.78 million (R45.7 million) in 2024. While this figure is not specific to financial planning practices, it shows how costly a data breach can be.
Protecting client information starts with everyday habits and everyone who handles personal information has a role to play, not just the IT team. An email sent to the wrong person, a weak password or a suspicious link can expose confidential information.
Financial planners should use strong passwords, enable additional security measures where possible and check recipients before sharing sensitive documents. Client records should also be stored securely and access should be limited to people who need the information for their work.
Artificial intelligence (AI) offers financial planners’ new ways to work more efficiently, but it must be used carefully.
The Financial Planning Standards Board’s (FPSB) 2026 global research found that eight in 10 financial planners work at firms that are already using AI or plan to introduce it within the next 12 months. The benefits are clear, 93% of financial planners say AI has improved their work efficiency, 83% believe it will help them better serve clients, and 75% expect it to improve the quality of financial advice. However, its growing use also raises concerns about protecting client information and more than half (53%) of financial planners identified data privacy and cybersecurity as their top concerns when using AI, followed by the accuracy and reliability of AI-generated information at 48%.
The research also found that 33% of financial planners say their clients use AI for general financial education, while 25% report that clients use it to validate or compare professional advice. These findings highlight the importance of using AI responsibly and ensuring that confidential client information remains protected.
Before using an AI tool, financial planners should understand how it handles information. Client statements, identity documents and financial records should not be uploaded to unapproved platforms and where possible, personal details should be removed and professional judgement should guide how these tools are used.
Financial planning practices should also train staff to recognise potential threats and have clear procedures for responding to security incidents. Under the Protection of Personal Information Act (POPIA), organisations must take reasonable steps to protect personal information and meet the applicable requirements when a security compromise occurs.
As the profession continues to embrace digital tools, protecting client information must remain part of responsible financial planning.
By taking practical steps to safeguard personal information, financial planners can reduce risks, meet their professional responsibilities and maintain the confidence clients place in them.
