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Democratising wealth management: The fintech revolution

Fintech opens up opportunities for individuals with various income levels to participate actively in building wealth

The wealth management industry has undergone a profound transformation that has fundamentally altered the way individuals of varying income levels access and manage their financial assets. This evolution has been remarkable, as it has shifted the industry from an exclusive service tailored solely to the wealthy elite to a dynamic and inclusive ecosystem accessible to a broader range of investors.

Traditionally, wealth management services were considered a privilege reserved for high net-worth individuals who sought the expertise of financial advisers and private bankers to grow and safeguard their wealth. However, these services were often associated with high fees, limited transparency, and a notable lack of digitalisation. This exclusivity within the industry created a significant barrier to entry for the majority of individuals seeking to build and manage their wealth effectively.

However, the disruptive force of fintech entered the scene and catalysed this transformative shift. Fintech harnessed innovative solutions to democratise wealth management. This technological revolution made wealth management more efficient, cost-effective, and accessible to all. The impact of fintech on the industry cannot be overstated, as it opened up opportunities for individuals with various income levels to participate actively in building wealth.

For us at Standard Chartered, we realised this at an early stage and set our objective to democratise wealth management, making it easily accessible to the mass segment at low cost. Furthermore, through partnerships and technology, we were able to expand the reach and scale of financial services. We also designed our wealth management proposition around this objective, offering a single wealth continuum, which enables our clients to move along our offering spectrum as they grow their wealth, from personal to priority to private banking.

Additionally, we stepped away from the traditional wealth management mind set avoiding the standard one-size-fits-all approach. As a matter of fact, we structured our offering to be accessible and customisable to cater to the diverse goals and preferences of our clients. We put personalisation at the heart of our strategy and committed to understanding the goals, risk tolerance, and time horizon of each and every single client of ours.

On the industry level, this transformation ushered in a new ecosystem introducing various innovations such as robo-advisers, online brokerage platforms, peer-to-peer lending, blockchain, and personal finance applications. These innovations facilitated automated investment advice, democratised stock trading, enabled individuals to invest directly in financial markets, allowed for lending and borrowing among individuals, and introduced new way to securely manage and transfer assets. However, the most important contribution was increasing financial literacy and equipping individuals with convenient tools to track expenses, budget effectively, and plan for their financial future.

The benefits of this fintech-led ecosystem are significant and multifaceted. It enhanced efficiencies and provided convenience to investors who can manage their wealth from virtually anywhere in the world. It also provided greater transparency by offering real-time data and insights, thus empowering investors with the information they need to make informed decisions. This levelled the playing field in wealth accumulation; therefore, boosting financial inclusion and empowering individuals to take control of their financial futures.

The evolution of wealth management towards a fintech-led ecosystem represents a profound shift in the financial industry’s landscape. As we look ahead, the future of wealth management is poised to be increasingly shaped by technology, making it an exciting and dynamic field to observe and participate in for investors of all backgrounds and income levels.

The writer is Managing Director and Head of Consumer, Private and Business Banking, Standard Chartered, UAE