There are several reasons a person chooses to change their wealth management provider—it can be reputation, quality of service, range of products, advisory capabilities, personal attention, fees and pricing, or technology.
As a generation of younger investors emerge in the Middle East, it is only natural for the demand in digital wealth services and technology to increase.
While wealthy investors still prefer face-to-face advice, the more tech-savvy successor values informed investment decisions that take into account public information they have at their disposal.
According to a recent survey by EY, 46% of clients in the Middle East value simple, intuitive digital processes for their investment activities and 25% receive financial advice through mobile apps. Some even choose their wealth management provider based on digital capabilities offered.
‘As clients redirect their asset management towards alternative business models, the demand for digital solutions that offer 24x7 anytime, anywhere access on any device is on the rise. In fact, 20% of clients in the Middle East say that they would switch wealth and asset management firms today for such a service,’ said Sarah Sanders, MENA wealth and asset management leader at EY.
Client preferences in the region’s wealth management sector has rapidly become more sophisticated in the last couple of years. An inclination toward digital and voice-enabled assistants have increased beyond basic, transactional activities to include managing wealth and receiving financial advice.
‘There is a fast-growing preference among clients to use mobile apps not only for executing transactions but for opening accounts, monitoring results, rebalancing their portfolio, and learning about products and services’ Sanders said.
The future success of wealth management firms in the Middle East, in an increasingly high-tech sector, will be determined by their ability to keep up with the pace of change and reconfigure their digital delivery model to meet these expectations.
Technology is moving towards hyper-personalization. Some private banks in the UAE are developing solutions that provide faster, simpler and more personalized ways of matching products and services with real-time client demands.
Their aim is to build a platform where clients have access to digital tools that facilitate self-investing while offering the option to receive human advice to maintain a balance.
The way forward
There is no doubt that Covid-19 has accelerated this process—a potential catalyst for technology adoption in this market segment. Financial advice that was traditionally given in meetings, are now delivered through a variety of platforms.
Video conferences have replaced face-to-face meetings for discussions and financial planning. Clients have also increasingly engaged through digital ‘self-serve’ channels such as apps, websites and live chats to access information.
The pandemic has substantially altered client expectations and caused more pressure on smaller wealth management providers who were limited in their digital client engagement infrastructure, and lacked self-serve channels such as trading and portfolio monitoring.
As other financial service providers continue to improve their digital experience, clients will naturally expect a similar level of experience from their wealth managers.
Wealth managers should consider developing a digital advice solution to support client relationship and management services. Oliver Wyman, an American consultancy firm with a presence in the Middle East, recommended wealth managers to design the advice delivery model of the future.
Suggesting an omni-channel solution, the platform should combine the expertise and emotional reassurance provided by a relationship manager, with the efficiency, convenience and scalability of digital solutions.
The Middle East’s mass affluent have become a lot more sophisticated over the last few years. With a pronounced predilection for technology, the client experience in wealth management needs to be redesigned with a digital-first approach.