Digitized Financial Services: Making wealth management easy and accessible

April 2, 2021 2:13 PM

Amongst all the things that digital financial services have done, the most monumental of them is making the entire process of wealth management user friendly and self-explanatory.

In India (and globally) digitization has been nothing but instrumental in transforming the way financial services has been perceived by consumers and stakeholders alike.

For most millennial investors the first ‘wealth managers’ that they usually come across are older members in their family. Especially in smaller cities and towns of India. Thus, making ‘professional wealth and portfolio management’ quite an alien concept, until very recently, when large scale migration and complex investment tools triggered a change in perspective.

Nonetheless even though commissioning a wealth manager is quite common now, there is still a dearth of services available in this sector. Though all wealth managers, especially the ones belonging to bigger corporate families, have spread their wings throughout the geography of the country – there are still some areas that are untouched. Consequently, in a country where there is a wealth manager or financial advisor available for every 100 people – there were also cities, towns and villages that had no access to professional help and education for financial planning.

This polarizing disparity was a great cause for concern till the financial services sector got a digital makeover.

In India (and globally) digitization has been nothing but instrumental in transforming the way financial services has been perceived by consumers and stakeholders alike. From making services accessible on the click of a button, to completely eliminating the need to go to a bank – technology has done it all. Amongst all of these things, the most noteworthy thing that the Fintech revolution brought along with it is ‘Inclusivity’.

Easy and Accessible – Digitisation catalyzing financial inclusivity

So, how exactly is digitization making financial services more inclusive? Let me explain this to you below:

1. Location independent:

In 2020, a nationwide lockdown temporarily shut shop for most companies in India. However, even in this dire situation one thing that investors could count on to always have their back was their financial services provider. This was thanks to customized mobile applications by smartphone companies that have literally picked wealth managers from their cubicles and placed them in the consumer’s hand. Available to them 24×7. Due to this, the services of a wealth manager are now not only restricted to tier 1/ tier 2 cities but can also be availed by somebody living in the most remote location in the country (even the world, if jurisdictional laws permit).

2. Regional connect:

India has 22 official languages and a population that is 1.1 billion people strong. In a country this populous, more than 80% people speak regional languages with very low reliance on English. In 2020, once the pandemic struck over 400 million people in the country used internet for the first time in their lives – and these do not speak English. When financial services providers went digital, they also introduced these services in languages other than English. This not only helped the brand penetrate deeper but also equipped a large mass of people to become self-reliant and responsible about their finances. Wealth Managers from big companies were now offering services in a language that consumers understood right where they were.

3. Lack of human error:

Since wealth management concerns with people investing their hard earned money, consumers are often vary about which portfolio manager they can trust – and even then there is always a room for human error. With the help of digitization, digital wealth managers are now equipped with bots and sophisticated technology like artificial intelligence and machine learning that employ sophisticated algorithms to study heaps of data and derive a conclusion. Thus, making the whole process automatic and relatively error free. This has further helped in reinstating investor faith in newer models of technology and investment.

User- Friendly, Seamless and Self Explanatory

Amongst all the things that digital financial services have done, the most monumental of them is making the entire process of wealth management user friendly and self-explanatory. Financial planning, stock market, investments and terms alike are often considered complex areas which the common man wouldn’t be able to understand. Digital financial services with the help of its seamless portals and applications have busted these myths and completely put the ball in the court of consumers. It has empowered consumers into taking control of their own finances and thus bringing more and more individuals into the arena of financial planning.

(By Saurav Basu, Head, Wealth Management, Tata Capital Financial Services)

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