Innovating in an evolving world

Private banking and wealth management industries have been slow to embrace digitisation. We look at how they can be innovating in an evolving world.


The private banking and wealth management industries have been notoriously slow to embrace digitisation. We look at the issues that have previously faced the industry – and the opportunities that technology presents for businesses, intermediaries and their clients.

Money is moving. Unprecedented global uncertainty coupled with the increasingly international nature of high net worth individuals themselves mean that the world’s wealth is constantly shifting. And with a reported $12 trillion in financial and non-financial assets currently shifting across generations (Accenture), the mobilisation of wealth is being driven by multiple factors.

In spite of this dynamic and ever-changing picture, the wealth management industry has been slow to catch on to the digital revolution. For too long, even the most forward-thinking firms lagged behind their retail counterparts, failing to embrace the opportunities digital presents for their businesses and their clients. And with a third of the next generation choosing a different wealth manager to their parents, there is a clear disconnect between what clients want and what they get.

So, why has wealth management resisted the innovations that other sectors have been so keen to capitalise on? A relationship-driven industry, early fears were that digitisation would be at the detriment of the personal service clients expect from their wealth managers. Having dusted themselves down from the financial crisis, many organisations have spent the last decade navigating the regulatory developments that ensued and reinstating lost trust amongst clients. With on-going cost and resource challenges, innovation was not a priority for many, who chose instead to rely on legacy systems that have hampered their evolution – and the client experience.

But as the industry has changed, there has also been a radical shift in the make up of the wealth management client. ‘Old money’ has been superseded by a new generation of wealth: entrepreneurial and innovative individuals who expect to engage with their finances when they want, and in real time. Even older generation clients have become accustomed to the autonomy and opportunities new technologies present and expect to stay continuously connected with both their wealth and their advisers.

Darkened out image of a skyscraper

The industry has woken up to this. Now, even the longest-standing firms are looking over their shoulders at the threat of new entrants who have the technology they need to revolutionise the client experience. And in a world in which high net worth individuals view their wealth management providers through the same lens as other luxury brands, it is more important than ever to provide an exceptional and innovative service that is consistent across every channel.

In spite of this, many firms fall at the first hurdle: onboarding. Historically a manual process made up of multiple layers of administration, a poor onboarding experience can delay proceedings, increase the margin for error and put off a prospect – even before any advice has been given. And for clients living and working across borders, relying on paper-based documentation, postage and signatories is both impractical and outdated. It is therefore no surprise that many wealth managers cite paperless onboarding as a key objective of their digital strategy.

Many wealth managers who were driven to digitise their systems by increased regulation will have since realised the benefits of technology for driving effective anti money laundering processes and suitability. While advisers are dealing with more information than ever before, those with robust systems have a clear advantage in understanding and evolving with their clients. By integrating flexible solutions that can accommodate the changing regulatory picture in multiple markets, firms can future proof their systems and minimise inevitable cost and disruption in the long term.

An effective digital strategy doesn’t stop at the client. Sophisticated intermediary or introducer portals enhance the brand experience and enable secure and seamless third party engagement through a consolidated view of the client, their wealth and objectives. Not only will this minimise time and effort for the intermediary and wealth manager, but it will provide a clear vantage point from which both parties can collaborate for the best outcome through a single capture of client information.

Digital creates clear opportunities for scale across geographies without the need for costly operational infrastructure. In today’s increasingly international marketplace, advisers who can remotely talk their clients through a shared view of their portfolios and documentation in real time, regardless of location, will have a clear competitive advantage.

Rather than replacing the client-adviser relationship, digital has opened up new channels, given clients choice and, in many cases, increased valuable engagement at a time where it matters most. Empowering clients at the start of their wealth journey will pay dividends in ensuring the optimum outcome for all parties, now and in the future.

Matthew Yates, Senior Vice President (Americas)

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