The World Wealth Report 2014 states that globally, 65 per cent of high-net-worth individuals (HNWIs) expect to run most or all of their wealth relationships digitally within five years. The report also dispelled several myths and stated that digital is not just favoured by younger HNWIs, but also by those in lower wealth bands and by investors who direct their own portfolios.
The future of both advice and the delivery of investment management expertise depend upon technology. This has overhauled goods and services in every other sector, yet within the wealth management sector the transformative power of technology lies largely untapped.
During the next few years, the real growth in the fund management sector will come through innovation, particularly in client service. At the heart of this is technology.
There are now roughly 50 DFMs available across 20 platforms. However, in most cases the platform is just the technology and the DFM is just that.
For platforms that can fully maximise the platform and DFM dualism through the successful integration of both elements, the result is a DFM delivered through technology. This also puts the adviser right back at the heart of the client relationship.
Forward-looking platform technology does not just host the investment solutions, it manages them, and the solutions become more flexible and sophisticated than simple model portfolio services. With a sufficiently wide range of options, advisers can avoid shoehorning clients and win trust for efficiency and value.
Client loyalty is preserved within the adviser firm, so crucially this structure enables proper ownership of the adviser’s business value. Advisers can build value into their own brand rather than simply making client introductions to DFMs, distributing fund models or selling insured products.
Nicola Robinson is corporate manager at Parmenion
The FinTech50 2015 list
More than 750 companies were considered for inclusion in the FinTech50 list for 2015, with the chosen companies selected for their potential to “become a game-changer in financial services technology, or the competitive staying power to continue being one”.
The FinTech50 list is comprised of four key areas:
• Banking and financial
• Big data and analytics
• Payments
• Platforms
Companies on the list:
27 The number of UK companies featured on the FinTech50 list
30% Percentage of the list comprised of FinTech companies from the Netherlands, Germany and Sweden
10 The number of companies the panel marked as ‘ones to watch’ on top of the FinTech50 list
World Wealth Report 2014
The annual report from Capgemini and RBC Wealth Management states: “Our research offers an unparalleled look into the demand by HNWIs for digital interaction and the disruptive force that digital technology is bringing upon firms, wealth managers and the overall client experience.”
Report findings include:
