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Technology and education essential for great wealth transfer

Technology and education essential for great wealth transfer

Financial education and simpler technology will be the key to unlocking value for millennials as the great wealth transfer takes place, experts have claimed. 

Anand Sambasivan, chief executive of investment platform PrimaryBid, said there were "so many different ways in which fintech can improve outcomes and provide better financial solutions to consumers", but more needed to be done to marry the technology available with the necessary education.

He said: "We’ve already seen technology dramatically change the landscape in areas such as payments, banking and investments - and we expect further disruption in other sectors including peer-to-peer lending and insurance.

"More regulated areas like capital markets remain relatively 'un-innovative' but that too is changing quickly. However, as these businesses improve access, information transfer and cost efficiency, education needs to catch up at a similar rate."

He warned it was no use having a "plethora of new options overnight" unless clients understood how to make the best use of them - and this applied as much to millennials, who are seen to be tech-savvy, as to any interested investor.

Mr Sambasivan explained: "The more successful fintech companies already know this and have simplified language to appeal to a diverse audience and to make it easier for people to understand the benefits of using their services – such as Transferwise and their ongoing ‘no hidden fees’ campaign."

Making the onboarding process of using fintech innovation easy and frictionless has also been beneficial for consumers, he said, and puts them at ease with new services.

But, he added: "Education is key – we need to work on our campaigns, PR and messaging – and not just tech – to make people truly understand that the new wave of financial services, driven by fintech innovation, is all about putting the consumer at the heart of their businesses and delivering better, and more inclusive services for everyone."

According to Mr Sambasivan, when PrimaryBid developed its share-buying platform, one of the key focuses was to remove any unnecessary jargon to appeal to the widest possible investor audience, as well as making the technology simple and convenient to use.

His comments were echoed by those of Yuval Reisman, chief executive of YRD Capital, which is a diversified fund of funds focused on algorithmic trading strategies in digital assets (such as cryptocurrencies).

While YRD Capital's target market is ultra high-net-worth, such as family offices, technology is not enough, without financial education. 

He said: "Education is key when entering an unknown territory. Digital assets, and the trading ecosystem around it, are very new, and changing all the time. It would be extremely hard for someone that is not fully committed to it to follow the changing trends and solutions.

"Also, from a risk mitigation point of view, the industry progresses very quickly. A few years ago there were no custody solutions. Now custody companies are working steadily on custody on the exchange and the fund together, which would create a very robust solution. People need to informed of these advancements to feel comfortable about investments."