A quarter of investors globally would consider changing wealth managers if they fail to modernise and embrace new technologies.
Research by Avaloq, which comprised 3,000 investors and 300 wealth managers across EMEA, found wealth managers were reluctant or unable to use investment advisory tools with clients.
It also revealed a willingness to embrace technology was a key driver of client trust in their wealth manager with 66 per cent reporting that being able to see investment analytics and portfolio visualisation was crucial to building trust with their adviser.
While 63 per cent noted the value of being shown the impact of their investment decisions on their portfolio live during meetings.
However, 44 per cent of wealth managers described their technology as outdated and 31 per cent said their systems were not suited to their needs.
Some 37 per cent of respondents globally were not using investment advisory technology live in client meetings.
Reasons included the user interface not being optimised for client presentations (78 per cent) and the systems being too confusing for clients (65 per cent).
Other barriers included an inability to hide sensitive information (40 per cent) and systems being difficult to navigate (39 per cent).
When looking at the UK alone, Avaloq found technology played a bigger role when it came to establishing trust in their wealth manager.
With 72 per cent of UK investors noting the importance of being able to see investment analytics and portfolio visualisation and being shown the impact of their investment decisions on their portfolio live in meetings.
However half of UK wealth managers currently did not use investment advisory technology with clients due to the design not being optimised for client use (78 per cent) and applications being too difficult to navigate (61 per cent).
The research revealed that a tech pain point highlighted by wealth managers in the UK was a lack of integration between their various systems.
Suman Rao, UK managing director at Avaloq said: “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pressure from clients to incorporate technology into their offering, many are struggling to keep up due to complex, outdated and poorly integrated technology systems.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.”
According to the research, 57 per cent of UK wealth management professionals felt their systems were not well integrated, versus 45 per cent globally, and 63 per cent said their data was seamlessly integrated across all the systems they used, compared to 58 per cent globally.
“The responsibility is not all on the wealth manager, technology providers must also step up to ensure they are delivering the analytics, automation and visualisation needed by both wealth managers and their clients,” Rao added.
alina.khan@ft.com
