Wealth managers struggle to meet clients’ technology expectations
Investors are increasingly likely to move away from wealth managers who fail to implement modern technological solutions.
Avaloq, a leader in digital banking solutions and WealthTech, has revealed this trend through new research involving over 3,000 investors and 300 wealth managers across Europe, Asia, and the Middle East. The study highlights that a significant 25% of global investors would consider changing their wealth management service if it does not modernize or embrace technology.
The research by Avaloq underscores that effective integration of technology into wealth management services builds substantial trust among clients, particularly through tools that enable visualization and real-time analytics of investment portfolios. Approximately 66% of investors stated that accessing investment analytics was essential for trust-building with their advisors, and 63% appreciated seeing the direct impact of their investment decisions during meetings.
However, there is a notable gap in the application of these technologies during client interactions. Many wealth managers admit to the challenges of using their investment advisory tools effectively. About 44% of managers surveyed described their systems as outdated, and 31% felt the technologies available were not tailored to meet client needs. This results in a significant 37% of wealth managers worldwide avoiding the use of these tools in live client meetings. The primary obstacles noted were non-optimized user interfaces for client presentations and overly complex system navigation.
The situation is particularly pronounced in the UK, where technology integration plays a crucial role in establishing trust. A striking 72% of UK investors emphasized the importance of visualizing investment analytics and impacts during meetings. However, half of the UK’s wealth managers do not utilize investment advisory technology with clients, often citing poor design for client use and difficulty in navigating the applications.
UK wealth managers also face additional hurdles with system integration. Compared to a global average, a higher percentage of UK professionals report poor integration among their systems, which complicates the delivery of seamless, personalized services due to increased manual processing.
Suman Rao, UK Managing Director at Avaloq, commented on the findings, “Our research reveals that while wealth managers are under increasing pressure from clients to incorporate technology into their offering, many are struggling to keep up due to complex, outdated and poorly integrated technology systems.
“Despite this, their reliance on technology is growing by the day and demand from clients is only going to increase. If wealth managers want to remain competitive and ensure they are delivering top client service, they must have a well-functioning technology ecosystem.
“That said, the responsibility is not all on the wealth manager, technology providers must also step up to ensure they are delivering the analytics, automation and visualization needed by both wealth managers and their clients.”
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