Every industry evolves. Each decade brings unprecedented changes to asset and wealth management providers, dating back to the 1970s when regulations for commissions disappeared.
The 2010s will be the decade that fintech created a unique set of disruptions for asset and wealth advisors to manage. Instead of in-person meetings and higher fees, the industry is moving toward investor independence and less manual oversight.
Everyone who didn’t want to embrace the rise of the robo-advisor must take a second look at the fintech options that are available today. As artificial intelligence begins to play a more active role in the industry, the firms that can automate tasks while providing essential services are the ones that will experience the most success.
What Does Fintech Mean for Today’s Advisors?
Deltec Bank said, “The modern investor expects to have digital tools available to them as part of their experience. Online collaboration occurs in many other areas of life today, so asset and wealth management should also have it.”
Firms are advertising on mainstream media about the development of tools that are easy to understand and use. Investors want to work with leaders who are aware of what fintech can provide for them today and in the future.
Up to 45% of affluent customers who recently changed their primary wealth management firm said that they did so because they wanted to go digital, while 72% of those under 40 said they’d be comfortable working with a virtual advisor.
Non-Traditional Firms Are Management Disruptors Because of Fintech
Financial advisors can come from almost any firm or agency today because of the availability of fintech. This disruption has led to more competition and lower fees for consumers, but has it led to worsening services?
Millennials like to take advice from people and companies that show a history of success.
If given the opportunity, most of them say that they’d take financial advice from businesses like Alphabet, Amazon, or Facebook.
Investors could benefit in several ways because of the presence of fintech. Costs still matter to the average person, even if they have wealth. Charles Schwab announced that its robo-advisor offering would have a $3,600 maximum per year. If you have a minimum of $25,000 to invest, then you can take advantage of this low-cost option.
That’s why the best advice that advisors in the asset and wealth management category can follow is to get the technology that helps you become more efficient right away. Allow these tools to be a way to draw closer to clients instead of further away from them.
It can help agencies create a structure that is profitable through efficiency, even as investors look for ways to tackle some of their investment challenges without assistance. The only thing that could stop this growth is a change to the regulations that govern this area.
Disclaimer: The author of this text, Robin Trehan, has an Undergraduate degree in economics, Masters in international business and finance and MBA in electronic business. Trehan is Senior VP at Deltec International www.deltecbank.com. The views, thoughts, and opinions expressed in this text are solely the views of the author, and not necessarily reflecting the views of Deltec International Group, its subsidiaries and/or employees.
About Deltec Bank
Headquartered in The Bahamas, Deltec is an independent financial services group that delivers bespoke solutions to meet clients’ unique needs. The Deltec group of companies includes Deltec Bank & Trust Limited, Deltec Fund Services Limited, and Deltec Investment Advisers Limited, Deltec Securities Ltd. and Long Cay Captive Management.