Why portfolio aggregation is a game-changer for modern wealth managers
WealthTech has transformed the modern world of investing. No longer is wealth management locked off to the wealthy. Tools are now available that can support investors at whatever life stage they are in and build portfolios that can support their financial situation and plan for the future.
However, while investing has become more readily available, there are still many that are not actively engaging with investing. Almost half of Americans (48%) do not hold any investment assets, according to a recent report from global active asset manager Janus Henderson. Staying in North America, a survey from CIBC found that only 48% of Canadians are investing annually. This is a similar situation in Europe.
With efforts to bolster financial inclusion, there are likely many people able to invest but simply unaware of the opportunities. Another common obstacle getting people to invest is a lack of time to engage with it.
Tamara Kostova, CEO of the WealthTech100 company Velexa, said, “Most people struggle to build investing habits due to high perceived barriers — knowledge, effort, cost. Investing should feel like a passive extension of their existing money routines, not a separate task.
“The most important aspect is integrating with everyday financial behaviours and habits around spending, saving, or budgeting. Embedding investing at natural financial touchpoints increases adoption as it feels effortless.”
Kostova offered some practical examples of how embedded investing is being used in the market to great effect. One of the common implementations is the round-up investing method. This is where purchases are rounded up to the nearest dollar and the difference is then invested. For instance, if the user buys a drink for $3.50; the purchase will be rounded to $4 and that extra $0.50 will be redirected to investing.
Another example is recurring transfers. These are tied to cash flow, such as on payday an amount is automatically transferred over for investing. Finally, Kostova pointed to budgeting insights, which can prompt users to invest leftover money from underspending. “For instance, choose to invest £10 instead of getting a glass of wine or beer with your dinner.”
Fredrik Davéus, CEO and co-founder of Kidbrooke, noted that the drive for embedded investing is only going to increase. “As investors become more informed and tech-savvy, they increasingly expect seamless, embedded investing experiences—similar to what they encounter in other digital domains. On the tech side, advances like generative AI are unlocking capabilities that were previously out of reach, enabling richer and more intelligent investment tools.”
A recent study from Morningstar claimed that 70% of Millennials would invest more if it were easier and more automatic. While a report from Plaid on embedded finance found that apps with embed investing at transaction points see up to two-times higher engagement rates compared to standalone investing apps.
However, firms will need to balance the systems to ensure the tools are simple to use but are not simplistic in their capabilities. Davéus said, “While simple in theory, balancing ease of use and complex functionality is difficult in practice. Success lies in designing intuitive, pedagogically sound customer journeys—supported by sophisticated backend logic.
“Too often, sophistication is sacrificed in favor of a simpler interface, resulting in solutions that may work short term but fail to scale or remain accurate over time.
The key is to separate complexity in logic from simplicity in user experience.”
Davéus is confident that the future of wealth management is dual-track. There will be some who will always prefer the human advisor with technology complimenting the efficiency of the relationship. On the other side, there will be self-guided investors with more powerful tools to help them.
How to implement embedded investing
Friedhelm A. Schmitt, Co-Founder and Co-CEO of Fincite, noted that embedded investing could be the next big trend of the WealthTech sector. However, implementing it is not a simple flip of the switch. He said, “Does embedded investing have the potential to become the next big thing in digital wealth building? I believe so, because everything that reduces complexity makes adoption faster and easier. But: It’s not a self-starter. Between platform, regulation, and technical integration lies a complex playing field and a huge opportunity.”
Schmitt believes a successful implementation of embedded investing comes from a triad approach that include the platform, financial institution and a technology partner. He added, “Unlike embedded payments or credit, investing does not work by default.” The platforms, such as retailers and service providers, bring the users, the financial institutions bring the regulatory license and trust, then finally the WealthTech partners bridge the user experience and regulatory framework through APIs, algorithms and advisory technology as the middleware.
Payments and lending have become the most common form of embedded financial service. For instance, buy now and pay later schemes have found their way into many checkout systems, giving consumers the ability to seamlessly take out a short-term loan at the point of transaction. However, embedding payments is not the same as embedding investing. Schmitt said, “While payments or credit directly support the core business of many platforms (e.g., checkout, liquidity), this is different for investments. Here, it’s not about transactions, it’s about trust, long-term thinking, and financial education.
“Except for financial institutions, investing usually does not support the core business. That’s why the use cases are much more complex to implement but also potentially more sustainable when it comes to customer loyalty.”
Schmitt outlined several innovative ways of embedded investing. The first of these are HR and payroll platforms with integrated wealth building, where employees invest directly through the payslip. For instance, 10% of their bonus automatically goes into a sustainable ETF.
Another area embedded investing can excel is through super apps. These are one-stop-shop application that aim to provide consumers with multiple types of services, such as WeChat and Alipay. Schmitt explained that through super apps, investing can become part of the everyday app. “Cashback becomes a savings plan, purchasing becomes capital building. Embedded investing turns into a daily habit.”
Next, Schmitt pointed to luxury brands serving as gateways to private markets. “The Prada Private Bank or the Bentley VC Fund: Ultra-high-net-worth clients gain access to exclusive investment opportunities, elegantly embedded in the brand world.”
The penultimate example Schmitt offered was ‘BNPL meets wealth: Invest before you pay.” This is a system where investments could be used as collateral for purchases instead of installment payments based on credit. Through this, portfolios or digital asset holdings become the new credit line for lifestyle financing.
Finally, Schmitt pointed to e-commerce as a low-barrier entry point for retail investors. “Own a share of what you love”. Invest €10 in a Global Sports ETF when buying sneakers. A bundle of customer loyalty and financial inclusion.”
He concluded, “Anyone who thinks embedded investing is just a feature underestimates the playing field. It’s about infrastructure. Regulation. Trust. And above all: relevance. The future doesn’t belong to the loudest apps, but to the platforms that intelligently combine financial education, investment advice, and technology.
“And yes – investing won’t be the next payment. It will be better. Because it helps people not only to consume, but to grow, to prepare for the future, and to reduce financial stress, embedded into daily life.”
A potential risk in the future
Jurgen Vandenbroucke, managing director everyoneINVESTED offered a practical example of how everyoneINVESTED is helping to embed investing into everyday applications. He noted that the everyoneINVESTED platform is designed to boost financial inclusion to the same level as its name implies. It does this by turning investing into a daily financial habit via micro-investing, allowing users to invest small amounts of money on a regular basis. This reduces the barriers to entry and allows people to invest even if they have limited funds.
He said, “In all markets where everyoneINVESTED has worked on micro-investing projects, be it Belgium, the Czech Republic or Bulgaria, the KPIs confirm the massive success in recruiting many users, most of them first-time investors and a whole generation younger than the bank’s existing investor base.”
By embedding investing into everyday financial apps, WealthTechs can change the way people engage with investing. As financial services continue to digitise and open banking becomes more prolific, it will be easier for embedded investing to grow. “The future of investing is not just for the wealthy or financially savvy – it is for everyone.”
However, Vandenbroucke believes there is a new challenge waiting around the corner. “Now fast forward. Imagine a world where investing is truly seamlessly woven into our daily financial activities. Then the next challenge is to keep everyone invested! Integration makes it easier to get in and get out and creates the risk of mass selloffs during financial crises.”
When markets become volatile, fear can lead to investors selling their positions en masse, he said. This can then exacerbate market downturns and lead to a financial crisis. To avoid this, understanding investor psychology is critical. For instance, everyoneINVESTED uses applied behavioural finance to build applications that can model and anticipate investor intent.
“Financial applications need to incorporate features that help users stay calm and make rational decisions during market turbulence. Access to real-time information can be counterproductive in this regard but is unavoidable given today’s technological capabilities. It is therefore crucial to support and advise users and help them navigate through periods of market stress.”
everyoneINVESTED also employs solutions with automated rebalancing to maintain portfolio stability. This can reduce panic selling by adjusting asset allocations based on pre-defined criteria linked to the client’s risk/reward balance. Additionally, it has solutions that incorporate educational elements to teach users about market cycles and ways to minimise the impact of market volatility. Finally, Vandenbroucke also pointed to the power of community features or social investing, which can create a sense of community and support to help people stay committed to their investment strategies and seek advice.
He added, “By addressing these challenges, everyoneINVESTED helps ensure that embedding investing into everyday financial applications not only makes investing more accessible, but also more resilient to market shocks. The goal is to create a stable and supportive environment where users make conscious investment decisions and feel confident about staying invested.”
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