Investors will expect their wealth management firms to feel like leading technology companies when accessed digitally, according to research that also shows how AI is breaking through in the financial advice industry.
Research from the London Stock Exchange Group (LSEG) shows 68% of investors that were surveyed expect their digital experiences with wealth management firms to match those of leading technology companies, which LSEG said increased the emphasis on omnichannel delivery.
About nine in ten investors believe AI can be used effectively for researching financial products and services
Financial advisers appear braced for changed. In its report, ‘The Future of Wealth: Why Consistency Matters’, LSEG found that 62% of wealth management firms expect that AI will significantly transform their operations.
Firms cited a host of benefits from AI, including greater automation and speed, a reduction in manual errors, and cost-effectiveness.
AI also appealed to investors substantially, said LSEG, promising constant connectivity, ease-of-use, cross-device access and lower costs.
However, the report did find that AI itself could not serve as the final product; rather, it “enhances the role of advisers and functions as a tool for capacity building”.
When asked what was the greatest value that advisers could bring in the next three years, almost half (45%) of investors who currently use an adviser, and more than half (51%) of those who do not, believe the primary value of an adviser in the next three years is in providing trusted investment advice.
The report suggests that a hybrid human-AI model will become the standard for the wealth management industry. Investors are generally open to AI being used in their investment journey, most prominently for researching financial products and services (over 90%) and supporting advisers in portfolio management (over 80%).
Researchers carried out the study among 2,000 investors globally across various wealth levels, ages, lifestyles, occupations, gender, and other characteristics. The study also included a benchmarking survey of senior executives from a cross-section of 250 wealth management firms,
Sune Mortensen, head of wealth solutions, LSEG, said the prevalence of AI and other technological advancements was making wealth managers rethink their business strategy and client engagement models.
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