Wealth Management Software Trends Fintech

5 New Trends in Wealth Management Software for a Fintech CTO

by Rick Martin

True to their history of leaving no financial sector unscathed, fintechs are disrupting the wealth management industry like a storm. With their hallmark technology-centric approach to market opportunities, fintechs are leveraging wealth management software to outpace incumbent investment firms. Unbridled by legacy systems and legacy ideas about how business is done, fintechs are offering customers lower fees and lower investment minimums than conventional providers, while leading the way in innovation.

As fintech CTOs seek ever-more creative ways to help their firms serve their customers, software innovation will play a key role in the products and services they provide. Here, we will discuss five of the hottest trends driving the wealth management software market and fintech services.

1. Customer Relationship Management

The penetration of fintechs into the wealth management marketplace has created a competitive environment for old and new players alike. Companies that cannot adopt an across-the-board client-facing approach will be left behind. The challenge to build and maintain customer relationships, while meeting regulatory requirements, makes Customer Relationship Management (CRM) solutions indispensable.

The unique nature of the financial services industry requires CRMs that are tailored for the industry. Whether a CRM solution is custom-designed or purchased commercially, it must do more than provide the standard array of features — calendars and scheduling, lead management, automated notifications, and data analytics, to name a few.

Fintech CTOs look for all the standard CRM features, but also require bank-level encryption to keep customer’s financial data secure, integration with wealth management solution partners, and portfolio management — features not available in standard CRM packages. And if the platform offers self-service options for certain account functions, so much the better.

2. Robo-Advisers

Customer demand for automated financial advice is a growing niche that financial service providers — conventional and fintech — are scrambling to meet. While a difficult business model may lead to a questionable future for stand-alone services, hybrid robo-advisers are growing in popularity. Even Fidelity launched its own digital/human platform this summer, which is a good indicator that robo-advisors are going nowhere soon.

Opportunities are many for fintechs planning to tap into this lucrative space, but success will come only for those that recognize the trends in this changing industry. It is not enough that customers be able to choose between automated, algorithm-based investment advice and a human advisor; they must also be able to access both using their desktops, smartphones, and tablets.

Further, while robo-advisors provide customers a level of control over their investment choices, some customers may want some hand-holding as they make their decisions. Forward-thinking CTOs will recognize the need for automated systems that allow a human advisor to come alongside the investor at any point their assistance is needed.

If robo-advisors are going to serve customers and wealth management firms in the long term, they will need to offer the same investment options provided by human advisors. In addition, they will need to establish a track record at least as good as that of their human counterparts.

3. Platform Integration

Advisors have available to them more wealth management tools than ever before. From investment management platforms to market news feeds, the advisor’s desktop is becoming a very busy place.

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Fintech CTOs should not ignore the growing need for wealth management integration solutions. It may not be possible, yet, for advisors to fulfill all their advisor functions within a single application, but they should at least be able to see everything without the need to toggle between desktop applications. The need is great for solutions that combine market news feeds, social media, email marketing results, transaction histories, and accounts and holdings in a centralized location.

Although integrated wealth management platforms have been around in various forms for awhile, the need to incorporate social media feeds and cloud-based services has not been. With the continued growth of social media platforms, big data, and cloud-based applications, the advisor of tomorrow will appreciate platform integration as much as a good stock tip.

4. Multi-Channel Delivery Platforms

When you think of trending software for wealth management, multi-channel delivery platforms may not be the first thing you think about. They are, however, something the fintech CTO must think about, if they don’t want to slip behind the technology curve that is rapidly changing the investment industry.

Today’s investor does not use the phone as their only means of interaction. They zip between websites, social media platforms, email, and text messages with ease. This demands that the wealth advisor be able to access their customers — and to be accessed by their customers — across the full digital spectrum.

Gone are the days when customers expect to visit a company website in order to make a purchase. More and more companies are facilitating purchases through social media “buy buttons,” blurring the distinction between social media and ecommerce websites. Likewise, tens of thousands of companies now use SMS marketing as a very effective part of their overall marketing strategy.

While these are but a couple of examples of multi-channel delivery, they represent the trend toward meeting the customer whether they are. The more wealth management customers and advisors can communicate in real time using whichever platform the customer happens to be using, the better the customer experience.

5. Big Data

Fintechs are not the only force to recently disrupt the financial industry; so has big data. From bank loan approvals to marketing, the financial sector is learning to use big data in a big way. Wealth management firms, too, have begun using this invaluable resource to grow their customer bases, and their bottom lines.

Big data is not just a buzzword. It represents large unstructured blocks of data from such sources as social media, financial records, criminal records, current and archived news items, and a whole lot more.

By itself, big data is of little use to the wealth manager. However, when accessed and analyzed by data analytics software, it becomes highly-valuable information. By intelligent analysis of big data, wealth management firms can help customers make better-informed decisions. Information from a social media post may reveal the customer’s plan to buy a house, affecting their liquidity. A news item may affect the customer’s market position. Or a twitter feed could indicate bad news for a pending transaction.

Smart CTOs will incorporate big data into the wealth management solutions they develop or recommend.

How Ignite Can Help?

Trends don’t just happen. They are pushed along by a select few who have the vision and efficacy to lead the way.

When you need a technology partner to help you chart the course, we invite you to contact Ignite. We operate six R&D labs across Europe, allowing us to support a broad range of technologies at outsource prices.

Our core competencies include mobile app development, web technologies, automotive, cloud platforms, media and entertainment, telecom, and gaming.

If you need a technology partner, we’d love to be the solution.