A new report from Forbes Insights and Temenos reveals the traditional wealth management industry is rapidly coming round to digital technologies.
Adoption of AI and machine learning technologies will help wealth managers counter the threat of robo advisers, according to a new Forbes Insights and Temenos report.
Wealth managers, it found, largely see AI as a game changer for the High Net Worth Individual (HNWI) and mass affluent market owing to its ability to deliver predictive guidance, improve risk management and personalise investment experience at scale.
More than nine out of 10 (93 per cent) of wealth managers say AI will play a role in the future of their practice while a broader acceptance of the ‘digitisation’ of financial services was also apparent in the survey results. This, the notion that financial services is being deing disrupted by digital forces, has risen dramatically to 52 per cent from 25 per cent of wealth managers in 2016.
A similar amount (54 per cent) of respondents said that AI will be essential for them to succeed and to offer personalised guidance and services for clients and prospects while 46 per cent of wealth managers believe that advanced analytics will help them acquire and retain mass affluent clients.
The survey found more than a third (34 per cent) of wealth managers are currently deploying AI within their firms and a further 25 per cent are testing it, and 99 per cent plan to deploy AI within the next three years.
Pierre Bouquieaux, Product Director Wealth, Temenos says that AI technologies are ‘weaving' their way into the traditional world of wealth management.
“[This means] a balancing act has emerged that will define the future of the industry: the blending of man and machine in advisors that produces better service and results for increasingly tech-savvy HNWIs and mass affluent clients," he said.
The emergence of robo-advisors, which automate asset allocation and portfolio management, has been a topic met by much scepticism in recent years but the survey suggested things may changing.
Today, however, almost 90 per cent of wealth managers questioned view robo-advisors in a positive light with 41 per cent believing that strong deployment of AI technologies will help wealth managers acquire and retain mass affluent clients.
Now in its sixth year, the AltFi London Summit returns on 18th March 2019 to 155 Bishopsgate. Last year proved to be a crucial turning point for the key players building the future of finance. Leading platforms launched oversubscribed IPOs, digital banks proliferated and mainstream financial institutions started their own disruptive propositions. With 2019 certain to be another landmark year, more questions will be asked by regulators with investor interest in disruption also poised for more rapid growth.