One of the primary reasons for the extremely fast use and adaptation of technology in the wealth management industry is the addition of a whole new set of millennial customers who are young and tech-savvy.
With the increasing use of mobile internet, a young tech-savvy person is used to shopping everything online, booking cabs with the click of a button, and checking out the latest news and updates. With the advent of lockdown forced by the spread of the COVID virus, the new words in people’s dictionaries are Zoom meetings, webinars, online statements, etc. We will look at some of the important aspects of wealth management from the point of view of advisors who are embracing technology like never before.
Client Onboarding
A rising number of firms are driving their business teams to enable their channel partners and sales teams, as well as their websites and apps, to onboard a client in a completely digital way. This completely does away with the advisor having to meet the client physically and fill out a bunch of application forms. The requirement of in-person verification is also now met by capturing the client’s photo and video through a digital medium. The person completes the entire form online and attaches a digital signature to it. This way, a financial advisor operating out of Dehradun can complete the KYC of a marketing professional living in Mumbai.
Process Automation in the Advisory services
A lot of processes, such as accessing the risk profile of the client, suggesting to him the most suitable asset allocation, and finally recommending investment products, are now taken care of by smart algorithms that take in and use multiple factors, such as the client profile and the latest market data, and churn out the end result in a matter of minutes. This reduces the human bias that can creep in based on the advisor’s own experience.
Intelligent alerts and notifications
Today, the advisor has a whole lot of data with him. With the use of AI and ML, he is able to get intelligent alerts, which helps him manage his clients better. A simple example would be the corporate deposit of his client, which is maturing in the coming fortnight. An AI-driven system could send an alert to the advisor, who in turn could advise the client on the best way to deploy the maturity amount. Systems could be built around nudging customers to start an extra SIP in case the goal accumulation is behind schedule. Systems could also check in real-time how much the customer is spending and tell him if he is going over the monthly budget.
Reporting and Client Servicing
Technology is fulfilling an important need here. The advisor is able to not only analyze the entire client portfolio, consisting of a whole lot of products but is also able to schedule it automatically to be sent to the client. A lot of customer queries can be handled with the help of an automated chatbot.
The advisors clearly see the benefits in the form:
- Increase in time spent coaching the client rather than filling out forms (this helps to overcome the client’s behavioral biases).
- Can handle more clients. (It can work anytime and anywhere as everything is digital.)
- Offer more products and services to the client (and, more importantly, offer the most suitable product to him at the right time).
- Cost reduction as processes become paperless and quick