Wealth managers that fail to leverage the opportunities offered by artificial intelligence (AI) technologies face an existential crisis, according to a new report ‘AI and the Modern Wealth Manager’ from Forbes Insights and Temenos, the banking software company. Support for technological innovation among wealth managers around the world has increased significantly over the last two years when only a quarter regarded digitisation of wealth management services as essential in 2016.
Digitalisation and specifically the use of AI is positively impacting portfolio returns, and improving client communication and overall experience, stated the wealth managers surveyed in the report. The deployment of AI technologies in wealth management is gaining traction and is expected to significantly increase in the coming years to improve user experience in both the High Net Worth Individual (‘HNWIs’ or ‘Investors’) and the mass affluent markets. Over a third (34%) of wealth managers are currently deploying AI within their firms and a further 25% are testing it, and 99% plan to deploy AI within the next three years. Indeed, almost a third of wealth managers believe that AI is a game changer for the industry and important to the future of their practice. HNWIs also appear aligned and optimistic about the use of AI with 84% being accepting or highly accepting of it in their investing experience, with 96% of investors being supportive of digitalisation. 41% of wealth managers believe that strong deployment of AI technologies will help them acquire and retail mass affluent clients.
Pierre Bouquieaux, Product Director Wealth, Temenos said: “Now that AI technologies are weaving their way into the traditional world of wealth management, a balancing act has emerged that will define the future of the industry: the blending of man and machine in advisors that produces better service and results for increasingly tech-savvy HNWIs and mass affluent clients.”