By: Joseph Wang, Data Scientist at VRGL
At its core, technology is developed to make the lives of its users better. As more industries continue to embrace new technologies, everyday tasks have become more convenient. Wealth management is another industry that has accelerated the adoption of new technologies to improve the advisor and client experience. With new ways to acquire, onboard, and maintain clients, advisors have many new tools to help streamline their workflows and make their lives, as well as their clients’ lives, easier, more informed, and more convenient. Additionally, technology has been able to lower costs for clients and hold advisors more accountable. All these changes improve the overall wealth management ecosystem and allow clients to put more trust in their financial advisors.
Technology has made business development and client acquisition more efficient for wealth management firms of all sizes. Depending on the business model, a wealth manager might target the mass market or specific high net worth individuals. Both must go through the “marketing funnel” which is the process from discovery to consideration and evaluation and the purchase decision by the client. Growing technological developments can increase process efficiency and help wealth managers accelerate the prospect’s journey through the funnel.
Mass-market firms can leverage systems on social platforms to be discovered by the most likely clientele. Chatbots can be used to provide a more personalized client experience at scale. Advancements in natural language processing (NLP) allow automated phone calls to take on an increasingly natural and personal touch. Firms targeting select clients can also utilize the same marketing tools but could benefit from specific tracking and analytics on their clients to provide premium services.
Additionally, proposal generation with advanced and customizable analytical tools help advisors build rapport, showcase their capabilities, and help clients objectively evaluate the value of services they receive from wealth managers. With client-provided personal and demographic data, software can cater to a client’s specific life experiences and provide relevant scenarios to consider. Tools like this provide a strong argument for an individual wealth managers’ value-add or lack thereof. Technology ultimately provides transparency and personalized services to help efficiently convert people into paying customers thus, starting the process of building lasting loyalty from customers and continued success for a wealth management business.
Exceed client expectations
Technology can also help streamline the onboarding process. The operational challenge of switching from one service to another is preventing many advisors and clients from choosing the best solution. A growing number of technologies are offering simple API (Application Programming Interface) connections to many different applications and processes. Most importantly, the wide adoption of cloud computing for SaaS (Software as a Service) companies is cutting down the transition time from quarters to weeks. Many cloud-native companies also feature client-friendly interfaces that allow advisors and clients to trial the product, providing process transparency and building confidence. Additionally, because the process is automated and most cloud-native applications have built-in encryption, the likelihood of data leaking, human error, and biases are reduced.
Newer technologies such as robo-advisors, give clients increased visibility and ease of access into their finances. One commonly discussed advantage of robo-advisors is the ease of data access for clients. Rather than having to ask your financial advisors about how you’re doing, all the analytics you’d want to see are readily available online. However, technology startups are also providing human advisors with similar levels of analytics capabilities and transparency. Clients now have a breadth of data and analytics at their fingertips, allowing them to understand their financial situation on a deeper level.
After the client has onboarded, advisors have a wide array of technological options to report and analyze their client’s investments, from portfolio construction to performance reporting. Technology also reduces the advisors cost to service clients. By simplifying their workflows and reducing manual effort, financial advisors are able to scale their business. In addition, the robo-advisor is also attractive for clients looking for a little less personalization and a lower cost. By making financial advisors’ lives easier and providing a wide range of alternatives for clients, technology has made having a financial advisor, human or robotic, less expensive, and more accessible for all.
Foster trust with technology
Ultimately, the hardest-earned currency in the wealth management business is trust. The current technological developments in the wealth management space aim to foster that trust. By providing more visibility into processes, reducing friction in communications and customization, empowering more informed decision-marking, and enabling built-in risk control, fin-tech companies are helping wealth managers earn trust faster, cheaper, and more sustainably.
Digital Banking – a hedge against uncertainty?
Ankit Shah, Head of Digital Banking, Apex Group
The story of the 2020’s thus far is one of crisis. First the world was plunged into a global pandemic which saw the locking down of people and economies across the world. Now we deal with the inevitable economic consequences as currencies devalue and inflation bites. This has been compounded by Russia’s invasion of Ukraine and subsequent energy politics.
And the outlook remains uncertain. Tensions continue to build between China and Taiwan and inflationary conditions are forecast to continue well into 2023. This uncertainty is impacting everyone, and every sector. And finance is no exception with effects being felt everywhere from commodity and FX markets to global supply chains.
But it’s not all doom and gloom. Rollercoaster markets and an ever-evolving geopolitical situation have made 2022 a tricky year far, but, despite the challenges, digital banking has proven resilient. In fact, the adoption of digital banking services has continued to grow over the last few years, and is predicted to continue.
So, what are the forces driving this resilience?
In an increasingly digital world and economy, digital banking comes with some advantages baked in, which have seen the sector continue to succeed despite the tumult in the wider world. In fact, the crises which have shaped the decade so far may even have been to the advantage of digital banking. Just as during the pandemic, technologies which could facilitate remote working saw a huge uptick in users, so to digital banking is well suited to a world where both people, and institutions demand the convenience that online banking services offer.
And while uptake of digital banking services is widespread amongst retail consumers, a trend likely to continue as digital first generations like Gen Z become an ever-greater proportion of the consumer market, uptake amongst corporate and institutional customers has been slower. This is largely down to a lack of fintech businesses serving the more complex needs of the institutional market, but, in a post-Covid world of hybrid working business, corporate clients are looking for the same ease of use and geographic freedom in their banking that is enjoyed by retail consumers.
This is not just a pipe dream – with the recent roll out of Apex Group’s Digital Banking services, institutions can enjoy the kind of multi-currency, cloud-based banking solutions, with 24/7 account access that many of us take for granted when it comes to our personal banking.
One significant difference between retail and business accounts however, for banking service providers, is the relative levels of compliance which are needed. While compliance is crucial in the delivery of all financial services, running compliance on multi-million pound transactions between international businesses brings with it a level of complexity that an individual buying goods and services online doesn’t.
For digital banking services providers, this situation is further compounded by guidance earlier this year from HM Treasury – against the backdrop of the Russia-Ukraine conflict- requiring enhanced levels of compliance and due diligence when it comes to doing business with “a high-risk third country or in relation to any relevant transaction where either of the parties to the transaction is established in a high-risk third country or with a sanctioned individual.”
So, can digital banks meet these standards while also providing institutions with the kind of easily accessible, mobile service which retail customers enjoy?
The answer is yes and again, once initial hurdles are overcome, digital banking brings with it features which give it the edge over traditional banking services. Paperless processes, for example, mean greater transparency and allow for better and more efficient use of data. This means AI can be employed to search documents, as well as provide verification. It also means compliance processes, often notoriously complicated, become easier to track. Indeed, digitising time intensive manual process means the risk of human error in the compliance process is reduced.
Digital banking can also better integrate transaction monitoring tools, helping businesses identify fraud and irregularity more quickly. This can be hugely important, especially in the times of heightened risk we find ourselves in, where falling foul of a sanctions regime could have significant legal, financial and reputational consequences.
Our world is increasingly globalised, and so is business. For corporate and institutional banking customers, being able to operate seamlessly across borders is key to the operation of their business.
This brings with it challenges, which are again compounded by difficult geopolitical and economic circumstances. In recent weeks for example, we’ve seen significant flux on FX markets which can have real consequences for businesses or institutional investors who are buying and selling assets in multiple currencies and jurisdictions. The ability to move quickly then, and transact in a currency of choice, is vital. Advanced digital banking platforms can help – offering automated money market fund sweeps in multiple core currencies to help their clients optimise their investment returns and effectively manage liquidity.
Control admin uncertainty
In times of uncertainty, digital banking can provide additional comfort via customisable multi-level payment approvals to enhance control of what is being paid out of business accounts, with custom limits available for different users or members of a team. Transparency and accountability are also essential, with corporate clients requiring fully integrated digital reporting and statements and instant visibility with transaction cost and balances updated in real-time.
For some, the perception remains that digital banking is the upstart industry trying to offer the services that the traditional banking industry has built itself upon. Increasingly however, the reality is that the pressure is on traditional banks to try and stake a claim to some of the territory being taken by digital first financial services.
With a whole range of features built in which make them well suited to business in a digital world, digital banking is on a growth trajectory. Until now, much of the focus has been upon the roll-out of services to retail consumers, but with features such as automated compliance, effortless international transactions and powerful AI coming as standard for many digital banks, the digital offering to the corporate world looks increasingly attractive.
Redefining the human touch with digital transformation
Simon Kearsley, CEO of bluQube
It may not be a new phrase, but digital transformation is still inducing anxiety amongst 80% of employees. Reigniting the conversation around the future role of the human workforce, the COVID-19 pandemic caused 47% of business leaders to implement new technologies, and a further 29% to develop plans to do so in the near future.
Creating increased efficiencies, cost savings, and improved customer service, several new technologies are becoming ingrained within core business operations. For example, the capabilities of cloud computing have enhanced the customer experience, and many companies are also using this to digitise their supply chain. Likewise, the combination of artificial intelligence and big data can also be used to automate nearly 80% of physical work, and 70% of data-processing.
In the digital era with so many new channels for communication, the ability to receive valuable insights from customers has in practice never been greater, which can in turn be used to inform future planning. Leveraged properly, this means that technology can drive benefits and growth for not just businesses, but also their customers and even their workforce. As technology empowers staff to transition their roles from more onerous, repetitive tasks towards impactful decisions within their organisation, this encourages the workforce to better realise the value of their contributions.
A data-driven workforce
When businesses embrace data-driven digital technologies, process optimisation across various sectors of the organisation occurs. For example, digitally-led automation, such as the use of OCR software, has been able to take over many time-consuming manual tasks, including data-entry, re-keying, and core administration roles. Although tasks of this nature may have formed a large part of some employees’ roles, this doesn’t mean that anxieties around the purpose of their job must increase.
Optimisation across the business isn’t limited to processes and costs, it also extends throughout the workforce. Less monotonous roles mean that employees are free to take on strategic roles that form a more rewarding career. In practice, this access to enhanced data empowers employees to expand beyond the limited resources they have for decision-making, instead leveraging the insight collected by analytics to make more informed decisions.
By replacing repetitive tasks, staff are becoming increasingly involved in the ideation process for new products and how to improve the company’s existing services. Besides the clear benefits this has to daily productivity and efficiency, staff are equipped with the tools to more clearly demonstrate their contribution to the business and, in turn, provide greater scope for progression.
As investment in data-led solutions continues and traditional roles are reshaped around its impact, employees’ digital skillsets will act as a key driver within the talent market and generate career progression that staff may have previously felt was unattainable. However, this outcome for staff will only be achieved if managers and senior members of the company are open to change and flexible enough to evolve alongside digital transformation. Technology adaptations are inevitable, and as its organisational applications continue to expand, managers would be wise to support new digital initiatives to remain ahead of the competition.
The business value provided by enhanced insights into customer preferences and behaviours cannot be overstated. With a clear overview of key behaviours, business leaders can accurately determine which areas of their processes need to be streamlined, where to focus their efforts, and how to attain the greatest possible value. On this basis, employees’ contributions will be vital for driving fundamental changes across the business, including roles in strategy development and operational management. Likewise, employees will be free to develop new product ideas and ways to improve the current service offering to benefit the business on a wider scale.
Amidst ongoing economic constraints, it has arguably never been more important for businesses to implement sustainable technologies that support their ability to respond to changing circumstances. Indeed, the insights discerned from employees’ data analysis and increased team collaboration are essential for reducing the risk of costly errors for the business.
In the coming years, AI-backed automation will become a key driver for technological change. As AI systems learn how to fit into the organisation and are programmed to improve over time, this encourages a greater focus on people on the long term. Not only should this reassure employees of their value, but it should also reassure managers that their investment was worthwhile.
Further reinforcing the value of a data-led workforce is the customer preference for real, human customer service – the value of which remains remarkably high. This is recognised by the vast majority (90%) of business leaders, who believe that the human touch of customer service has become even more important amidst advancing technology, with 40% describing the continued human touch in customer service as a ‘100% mission critical focus.’
Experienced across virtually every industry, many companies may have temporarily seen customer service levels slip during the COVID-19 pandemic. However, technology is able to reverse this trend, supporting the human element of customer service with high-value data and insight. This enables teams to make decisions based on what they have learnt from evolving customer data and feedback, which can then be leveraged to improve the customer experience on an ongoing basis.
An additional benefit of digital transformation for customer service teams is that technology streamlining businesses’ operations in turn frees up organisations to provide the other crucial strand of the human touch, with dedicated customer service teams to personally connect with customers.
The bottom line
Simply enough, data-led technology significantly benefits business leaders, employees and customers alike. Achieving just base-level insights increases job satisfaction and security, encourages client retention, and instils confidence in customers that they are receiving a high-value service. For the four out of five workers that remain anxious about the implementation of digital technologies, it must be remembered that these advancements create an exciting opportunity for the human touch to grow alongside them.
Know Your Business (KYB): Exceeding KYC
Victor Fredung, CEO at Shufti Pro Money laundering costs the UK more than £100 billion pounds a year, according...
Tax giveaway is a boost for business, but will it drive growth or fuel inflation? Chancellor Kwasi Kwarteng has...
A zero trust environment is critical for financial services
Boris Bialek, Managing Director of Industry Solutions at MongoDB Not long ago security professionals were still focused on protecting their...
Digital Banking – a hedge against uncertainty?
Ankit Shah, Head of Digital Banking, Apex Group The story of the 2020’s thus far is one of crisis....
Union Bank of India goes live with RuPay Credit Card on UPI with Kiya.ai as a technology partner
Nitesh Ranjan, ED Union Bank of India with Rajesh Mirjankar, Managing Director & CEO, Kiya.ai at the launch Kiya.ai,...
Anyone Can Become an R&D Tax Expert with the Right Foundations
Ian Cashin is a Customer Success Manager at Fintech company and R&D tax software provider WhisperClaims For accounting firms,...
Addressing the ongoing global pilot shortage issue
By Bhanu Choudhrie, Founder of Alpha Aviation The Covid-19 pandemic brought the aviation industry to a halt, causing vast...
How exporters can mitigate risks and operate smoothly in stormy, post-Brexit waters
By Morgan Terigi is Co-Founder and CEO of Incomlend The past few years have presented a series of hurdles...
From employees to customers, workforce management can benefit the entire banking ecosystem
Michael Cupps, SVP of Marketing of ActiveOps explores the significant impact workforce management can have on the employees and customers...
Redefining the human touch with digital transformation
Simon Kearsley, CEO of bluQube It may not be a new phrase, but digital transformation is still inducing anxiety...
CFOs – the forgotten ally in the fight against ransomware
Justin Vaughan-Brown, VP Market Insight at Deep Instinct Ransomware attacks have nearly doubled in the past couple of years....
7 cost benefits of cloud accounting software
By Paul Sparkes, Commercial Director of iplicit, an award-winning accounting software developer Is your accounting software having a laugh...
How does Identity Access & Privileged Access Management help in PCI DSS Compliance?
Narendra Sahoo is a director of VISTA InfoSec. Introduction The Payment Card Industry Data Security Standard also commonly referred to...
Listed private debt deserves a closer look from investors
By Michel Degosciu, Managing Partner, LPX AG Over the past few years, the private debt asset class is attracting serious...
Security vs online payment convenience: which one is tipping the scales for customers?
Chirag Patel, President of Digital Wallets at Paysafe. While keeping their payment details safe is a top priority for...
The Tool and Tips to Truly Get Started with No-Code Development
Author: Chris Obdam, CEO of Betty Blocks Throughout the legal industry, firms and in-house departments are leveraging legal tech...
How ReFi Will Transform Finance
– by Ransu Salovaara, CEO of carbon platform Likvidi Humanity faces a multitude of threats, many of which are...
THE NEXT WAVE OF FINTECH IS HERE
Much has been made of the ‘second generation’ fintech movement recently, but what have these businesses learned from those entering...
UK leaves Europe trailing in its embrace of digital banking
People in the UK have embraced digital and online banking in a way that those across the rest of Europe...
The rise of automation and its impact on the CFO & CIO
By: Gert-Jan Wijman, VP Europe, Middle East and Africa at Celigo On the back of the pandemic, organisations have...