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MAR 15, 2022

Investigating Wealth Tech: trends that will be driving the next moves

Alexander Cassar

Chief Business Operation Officer at Objectway

Reading time: 2 min


2020 was the year when the global pandemic blew up, disruptive changes emerged, and businesses promptly adapted to maintain their positioning. 2021 was no less eventful and organisations have been focusing on reducing uncertainty, enhancing trust and reinforcing digital client experience.
2022 opens up to a Never Normal scenario, where having a digital DNA empowered by technology will be the ultimate game changer.
Objectway features The Wealth Mosaic WealthTech 2022 Report to thoughtfully look at past and current trends, how they shaped the industry, how many of them still holds the line and will drive the next moves

2021 in a review

In 2021, digitalisation was categorised as the must-have ingredient. Most clients increasingly expected digital superb real-time, hyper-personalised interactions and experiences. To meet these renewed needs, wealth management and private banking players invested in redefining their IT and business strategy in 2021, either embarking on digital transformation programmes or – if not ready yet – being acquired by bigger, digital-first firms.
To support the client experience, firms have made progress in managing and designing their client portal, adding new features to make it more interactive and offering new services. Digital onboarding was also beefed up to provide a frictionless and fully compliant experience. However, it was not all about digitalisation, and another trend in 2021 was the unusually high attrition and migration of qualified workforces. In private wealth, it was recognised that despite advanced intelligent technologies, competitive edge comes from high-quality human staff.
Not to be forgotten, in 2021 ESG was of course not put aside, and the industry went through a massive new wave of interest in responsible investment.

2022 in a view

2022 is already picking up the pieces of those important decision made in 2021, but organisations are now aware that the world we live in is more dynamic and less predictable, so it pays to be prepared. In 2022 trends will be progressively driven by increased competition, perpetually changing client expectations, maturity of technology & digital first DNA. This allows to formulate a few hypotheses on where the relentless progress of technology is taking us.
For sure, a hybrid model for advising clients is confirmed to be the best opportunity when looking at the client relationship, combining both technology and a human2human approach. At the same time as providing the personal touch, wealth managers also need to make sure their virtual client experience is top-notch, finding ways to differentiate themselves through online customer engagement and branding excellence.
However, beyond hybrid advisory, we reckon that Outsourcing, ESG and Cyber Security can be emphasised as the highest priorities for our industry in 2022.
This is all the more important given the entrance of younger investors to the market and their high expectations around digital service, but also their demand for technology-driven, transparent, ESG compliant investment platforms and strategies.

Outsourcing practices, in particular, are reshaping the industry, because of advantages in terms of cost reduction, enhanced efficiency and flexibility. Cloud-first mindset and toolset is also recognised as one of the primary steps in the outsourcing journey and more investment in supplier management technology capabilities are pictured.
Firms will be required to implement a future-proof digital transformation programme. The aim is to deliver cutting-edge digital capabilities, rethink customers’ digital engagement in light of a profound understanding of customer behaviour and expectations, launch apps for investors, redesign operations taking into deep consideration new economic realities and societal shifts. Practically speaking, firms will be looking at end-to-end customer experience optimisation, operational flexibility, and innovation. This approach will lead to business model transformations and new forms of digital processes.
Looking ahead, winning firms will show their agile nature and responsiveness to market changes and client needs, with a focus on talent pool, innovation capacity and strategic growth.

Read the full report in collaboration with The Wealth Mosaic.