(Digitalisation Is the Key For The Prime Customers)

Wealth management business is an investment advisory service that integrates other financial services to address the requirements of high net worth clients. It is a consultative process where the advisor collects information about the client’s wants and tailors a personalised strategy utilising appropriate financial products and services.A single manager coordinates all the required services to manage assets of HNIs and plan for their own or their family’s current and future needs.


Previously Wealth Management was a privilege for large wealth holders. Therefore, Wealth Management companies had a very narrow and homogenous client base. In last few years, a disruptive trend has occurred in the industry. New digital services have been launched through technological innovations which are increasing pressure on the profit margins of the industry. Wealth managers are required to incorporate technical development into their product portfolios, not only to retain existing clients, but also to attract the large share of non-High Net Worth Individuals who are now also potential clients.

Need for digitalisation in wealth business

Indian markets have moved up the ladder of the digital wealth management world due to constant increase in the number of high net-worth investors. Wealth managers have opinion that a mix of digital and offline ways of communicating is ideal. In the changing digital ecosystems wealth managers should serve these HNIs with enhanced skill/toolswho are still under-served by traditional wealth management institutions.This transformation is a result of varying market conditions and various other factors in the economy:
  • Market Trends – Current generationis well informed and prompt in their responses towards changing market trends. They make quick variations to their business models in order to match the ever-changing external environment of a company. This changing environment needs fast moving investment requirements and to meet these efficiently, use of technologically advanced tools is very important.
  • Customer Preferences–Most of the HNIs believe that digitisation of wealth management services is a positive approach but still they would prefer to meet their wealth managerstime and again. Understanding the client requirements to build an engaging experience is important. Investors are keen to know and control their investments constantly under the supervision of a wealth manager. They also expect high quality services to be maintained with confidentiality. Customers want to invest less and less time, which has positively impacted the emergence of digitalisation of wealth management.
  • Stringent Regulations– Introduction of new currency and demonetisation, changes in tax structure due to GST and other changes have made the investors apprehensive about the profitability and stability of investment options. Transparency has now become a key aspect to assimilate technology in all transactions in the economy. Speedy adoption of these regulations has made it necessary for one to digitise his operations.
  • Creating Environment of Faith– Poor communication skills, lack of transparency and a high face-to-face meeting expense has cost the wealth managers the trust that investors had in their services. Now a days, social media tools are being used to re-establish this trust and provide transparent data. With the help of these tools, investors can acquire investment information as well as have regularinteractions with their advisors in order to build a trust environment.

Impact of digitalization on wealth management

New tech savvy generation conduct all their interactions and transactions online with the help of their smartphones. Digital innovations in the investment world have changed the way investors approach. It has empowered them to take quick and riskier decisions with the help of technology. Such an efficient working environment has led to the following changes in the wealth management world:
  • Intelligent investment decisions– Digitalisation of data enables one to access large amount of information relating to not only the current year but also many previous years. With wealth managers using sophisticated tools like cloud computing, social media and mobile applications, these tools help them fulfil their services faster through a greater number of interactions with the client yet at lower costs.
  • Increased productivity– Digitalisation has benefited both, the wealth manager as well as the investor. The process of communication of investment idea between both the parties has become efficient. The investors can now hold a better and more dynamic portfolio. Regular digitalassessments have reduced errors as well as helped track investments, increasing transaction activities and in turn, boosting efficiency.
  • Time is the key– Time is a key factor in investment. Investing money in a rising asset at the right time can lead to remarkable profits, while doing the same at a time not suitable for that particular asset may lead to substantial losses. Investors who adapt to digital tools, capture each opportunity available at early stage, yielding higher than expected returns. With the progress in digital technology, the wealth management business is transforming from a channel for financial products to a channel for financial advice.
  • Technological know-how– In order to build an investor’s profile, wealth managers have started giving importance to recognise their client’s digital know-how. Investment strategies based on complex technological tools, which are difficult for the investors to understand, may not give the desired results. Therefore, digitalisation and technological know-how should be focused towards improvement as well as personalisation of an investor’s investment portfolio, keeping the goal-based investment concept in mind.
  • Abundance of Information– Investorspursue detailed research on their investment options from the wealth manager. Information overload can either overpower or confuse the investors. It is pertinent to provide the investors with the correct information for their portfolios at the right time. Digital resources help a wealth manager to support their clients and help them to implement investment strategies efficiently at every step.
  • Sophisticated advisory role– Digitalisation has changed a wealth manager’s role completely as they are now not an investor’s main source of information. Investors today depend on various websites, research papers available online or videos of company management etc. for information. Thousands of sources provide vast data across the globe within minutes. The role of wealth managers has evolved from tedious administrative tasks to more sophisticated advisory activities.They are directly accountable for addressing an investor’s requirements and concerns.

Digital Strategy

Through investment in innovation and digitisation, wealth managers can not only enhance efficiency but also protect their businesses by upgrading client touch points and renovating their value propositions. Some of the examples of digital transformation within wealth management, from client onboarding to fulfilment and trading are:
  • Onboarding of Clients-Some wealth managers have launched a service allowing clients to open accounts using videoconferencing. Others are following suit and digitising the onboarding process using innovative technology, from electronic signatures and online ID verification to biometric authentication.
  • Personalised Advice-A suite of digital banking tools have been introduced for tablets and smartphones. The app provides personalised content, trading tools and opportunities for better portfolio management. This is a part of transformation of wealth management through digital technology.
  • Interactive Sales Process –Service Providers are designing tablet apps which consolidate all relevant sales functions in a single platform.This supports relationship managers by guiding them through a smart, adaptive and interactive sales process.
  • Tailored recommendations-Personalised “health checks” havebeen introduced that identify potential issues with personal portfolios, offering tailored remedies to bring the health status back to desired levels.
  • Trading- Several wealth managers are building digital solutions that provide social marketplaces where customers can trade stocks and funds online.

Robo-advisors equipped with AI: the game changer

A robo-advisor is a digitalised Wealth Management service which is app or web accessible. This service is based on applied algorithms designed by portfolio managers which gets automatically executed. The following steps elaborate how a robo-advisor manages the process from a client’s onboarding to portfolio management:
The most advanced stage of robo-advisor sees algorithms involved in the definition of investment rules. Based on the answers to the initial questionnaire an appropriate asset allocation is chosen and continuously evaluated by the help of artificial intelligence.Moreover, investors who are still using the old methods of working are losing various upcoming opportunities to optimise the risk-return profile of their portfolios.


Undoubtedly, digitalisation has a substantial impact on the business and operating models of financial institutions worldwide. The digitalisation of financial services is only going to increase. Against the backdrop of an increasingly competitive wealth management scenario, the financial institutions that can effectively leverage technology to drive operational efficiency and enhance client experiences will secure a major advantage.


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