FinTechTalk: Developing and delivering a digital wealth management strategy

On 19 September, FintechTalk host Charles Orton-Jones was joined by Simon Alioth, Managing Director, Synpulse8; Kai Linde, Co-Founder, QPLIX; and Patrick S. Maurenbrecher, Managing Partner, CIO, Kontora.

Views on news

In June 2020, the global management consultant Synpulse and the Swiss regional bank St.Galler Kantonalbank (SGKB) established the OpenWealth Community with the aim of defining an API standard for wealth management. There are now 13 banks (and 60 members altogether) in Switzerland supporting the establishment of the new API standard. Some banks have already gone live with the OpenWealth APIs.  

 

There might always be exceptions but covering 80-90% of APIs with a standard can increase efficiencies tremendously in the wealth management ecosystem and lead to the democratisation of the sector. Private equity is lagging behind in terms of digitisation with the majority of big players providing data in pdf files, which stands in the way of implementing digital transformation projects. Digital interfacing replaces digital storerooms where pdf and other files are stored by simply setting up a connection with the custodian bank and receive all the required historical data.  

 

How have the customer expectations and client behaviour changed?

Young generations expect the level of digital service they got used to in other sectors, so, for them, pdf files won’t cut it. In response to this, fintechs such as Kontora can offer dashboards where all the different types of wealth assets can be seen and managed. In defence of large companies, they cover the whole value chain, so for them, digital transformation is much more challenging than to a young, digitally enable company. With digitalised solutions, it’s easier to test the user experience too and B2C apps offer ideas regarding how the user experience can be made more seamless.

 

A good application should offer ease of use, as well as functionalities where the user can dig deeper. Gamified apps, on the other hand, are well-suited to speculation but not to wealth management. The business case for a wealth management platform is that it liberates experts from doing mundane tasks, so they can focus on high-value ones. It also improves data management and analytics capabilities and drives better and faster decision-making. Service providers will also maintain and develop the platform for a business. 

 

Panels’s advice

There is no correlation between the size of the wealth and the standard of managing it. Billionaires may have their wealth managed in excel sheets. 

Democratisation of wealth management from the banks perspective means that affluent clients can have access to a level of service that millionaires and billionaires get – maybe with less frills.