Expanding access to sophisticated financial services
The wealth management landscape in APAC is no doubt evolving, but significant gaps remain, particularly in serving the mass affluent.
With the segment expanding at an impressive 10% annually for over a decade, the urgency to democratise access to sophisticated financial services has become increasingly apparent.
As the industry gradually adapts to cater to a broader range of investors, from the mass affluent to high-net-worth individuals, wealth managers must address challenges, including regulatory complexity, rising fintech competition, changing investor preferences, and talent shortage.
Top five areas for wealth management firms to focus on
To overcome challenges and embrace opportunities, wealth management firms should focus on:
Bridging the affluent segment gap: There is a notable disparity in services available to the affluent segment, especially for those who fall short of the thresholds for accredited or professional investor status. This group often receives high-margin, one-size-fits-all products, revealing a clear opportunity for more personalised, accessible solutions.
Regulatory frameworks and product access: Regulatory distinctions, like the accredited investor status in Singapore or professional investor in Hong Kong, create significant divides in product access. While these regulations are designed to protect smaller investors, they also limit their options, posing a challenge to wealth management firms.
Emerging market challenges: Unlike established markets like Singapore and Hong Kong, emerging markets face substantial regulatory limitations on product offerings. This often forces investors to look for more diverse investment options offshore, highlighting the need for more inclusive local solutions.
Lowering entry barriers through technology: Fintech innovations, including robo-advisors, are making wealth management more accessible to the mass affluent. These platforms typically offer ETF-based model portfolios with low entry hurdles, broadening access to diversified investment strategies.
Philanthropic initiatives: Some wealth management firms actively engage in philanthropic efforts that also support wealth democratisation. For instance, initiatives like school-building projects allow donations starting from as low as USD 200, demonstrating how philanthropy can be made accessible to a broader range of individuals.
By bridging service gaps, adapting to regulatory complexities, and leveraging technology to automate business operations, the industry can expand access to sophisticated financial services. These efforts will drive sustainable growth and better serve this rapidly growing market.
To discover how you can maximise your business’ potential, feel free to reach out to our expert, Yves Roesti, Managing Partner and CEO at Synpulse Group, at yves.roesti@synpulse.com.
Special thanks to Yves for his valuable insights during our podcast episode. For a more in-depth discussion, listen to the full episode here:
What's next?
Next week, we’ll talk about Wealth-as-a-Service. Stay tuned for more industry-leading insights, straight from our experts to your inbox every Friday.