Wealthtech automation can streamline money management

Tags: Financial servicesIdentity verification

People seeking financial advice often turn to wealth management advisers for tax and estate planning, legal and accounting services, and investment guidance. Wealthtech solutions are taking those services into the digital realm.

Wealthtech covers a range of digital services that help people maintain and enhance their financial well-being. It holds the potential to reduce financial management costs, broaden the market and optimize performance by:

  • Automating procedures
  • Using artificial intelligence to provide deeper analytical insight
  • Customizing experiences and advice with digital personalization

The arrival of robo-advice

Wealth management can be complex and sensitive. People often face what can feel like an overwhelming amount of information and almost too many options for managing their money. But they also know the results can have a significant effect on their quality of life.

Robo-advisers are designed to simplify the process and make it more accessible, offering 24/7 advice and sophisticated tools. The advanced software uses algorithms to provide automated investment portfolio management advice. In 2022, the worldwide sector was projected to hold $1.66 trillion in assets under management with an annual growth rate of 14.19%.

Robo-advice doesn’t replace wealth advisers. They often work in tandem, with robo-advisers handling certain aspects of the relationship and wealth advisers answering questions and providing expert advice. While robo-advisers are becoming increasingly refined, they can’t provide the breadth, depth and insight that wealth advisers can deliver.

Expanding investment options

Wealthtech services are going beyond financial advice by enabling innovative investment opportunities such as:

  • Micro-investment platforms that allow people to invest with small amounts of money
  • Social trading, which makes investing as simple as a social follow
  • Portfolio management and investment tools that deliver better information and management oversight on a broader range of investment options

New wealthtech apps and services from fintechs and traditional financial institutions continue to create opportunities for customer acquisition and new revenue streams.

Building trust in new channels

For all its innovations, wealthtech is fundamentally different from traditional financial advice channels. The years spent acquiring a deep understanding of financial strategy and building one-to-one trust in wealth management don’t apply in the same way to the digital world. Deep knowledge and trust are still necessary, but digital techniques rely on codes and systems.

Winning and keeping customers through wealthtech often depends on user experience, the underlying tech stack and algorithms that power the app or service. Can the app onboard users quickly and easily? Does it present information in an easy-to-follow manner? Does it take advantage of the latest developments in interface design to enhance interactions?

Making a strong first impression during onboarding

Often, the most important step in the wealthtech customer journey is onboarding. After all, an onboarding prospect has no vested interest in a service and can move elsewhere with just a click.

The Trulioo 2020 Account Opening Report found that only 43% of consumers were very satisfied with recent financial services account opening experiences. Offering fast, intuitive onboarding experiences can help increase that satisfaction number.

Onboarding is also a crucial step for regulatory compliance. While it’s prudent to regularly perform identity checks, onboarding typically requires the most due diligence. Preventing fraudsters and money launderers from opening accounts is the surest way to stop questionable activity before it starts.

If done correctly, with a smooth and secure onboarding experience, wealthtech can provide substantial growth opportunities for the financial services industry.


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