A quarter of global investors would consider switching from wealth managers who fail to modernise and adopt new technologies, a new study by Avaloq – a provider of digital banking and wealth management technology – reveals.
The research, which surveyed more than 3,000 investors and 300 wealth managers across Europe, Asia and the Middle East, highlights a growing demand for tech-driven services in wealth management, with tools like investment analytics and live portfolio visualisation being crucial for client trust.
Twenty-five per cent of investors globally would consider switching from wealth managers, while two thirds of investors (66 per cent) reported that being able to see investment analytics and portfolio visualisation was crucial to building trust with their adviser. Sixty-three per cent noted the value of being shown the impact of their investment decisions on their portfolio live in meetings.
Little confidence
Avaloq found that 44 per cent of wealth managers view their systems as outdated, with 31 per cent stating that their technology does not meet their needs. This dissatisfaction affects service delivery, with 37 per cent of wealth managers not using investment technology in client meetings.
Key issues include poor user interfaces (78 per cent) and systems being too complex for clients (65 per cent). In the UK, where technology is even more critical for investor trust, 50 per cent of wealth managers still don’t use such tools, citing similar challenges.
Additionally, 57 per cent of UK professionals report poor system integration, leading to manual processes and hindering personalised service.
“Our research reveals that while wealth managers are under increasing pressure from clients to incorporate technology into their offering, many are struggling to keep up due to complex, outdated and poorly integrated technology systems,” says Suman Rao, UK managing director at Avaloq.
“Despite this, their reliance on technology is growing by the day and demand from clients is only going to increase. If wealth managers want to remain competitive and ensure they are delivering top client service, they must have a well-functioning technology ecosystem.
That said, the responsibility is not all on the wealth manager, technology providers must also step up to ensure they are delivering the analytics, automation and visualisation needed by both wealth managers and their clients.”
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