Creating a work culture that is open to innovation
Financial services providers must ensure a work culture that is open to innovation in order to reap the benefits of new technology.
More and more established providers are buying into fintech disruptors such as Gambit, Wealthify, and Scalable Capital.
As GlobalData Financial Services has noted, incumbents seem to be finally embracing new technologies to digitalize communication channels and portfolio management.
As per GlobalData’s 2017 Global Wealth Managers Survey almost 50% of private wealth managers globally are already partnering or planning to partner with fintech start-ups over the next two years, with this figure rising to over 60% in Asia Pacific.
Many robo-advisors have been struggling to gain scale, with client acquisition representing by far the most difficult issue. Partnerships expose them to a new client base, growing their brand reach without the need for costly marketing and advertising.
For example, Scalable Capital was able to surpass $500m in AUM over the first 10 months of 2017, acknowledging that its partnership with ING in Germany was one of the main drivers to its growth.
However, it’s important to stress that banks need to work on the underlying company culture for these partnerships to succeed.
The toughest hurdle in the way of private banks’ digital capability doesn’t seem to come from compliance, but from a rooted mistrust in technology.