According to Finextra’s predictions at the start of Covid-19, “Digital tools are the lifeline that will help wealth management firms survive the coronavirus pandemic.” Where are the trends headed now and what are the implications?

In a recent interview, Julien Menager, Head of Projects at JM Finn discussed digital integration trends, and the balance between innovation and regulation.

Menager mentioned the differences in the way the average individual is communicating. “A very practical basic example is that even the oldest generation has begun using applications like Zoom and WhatsApp to communicate with family and friends”, Menager says. “This has triggered a number of possibilities for relationship managers to offer this communication technology to clients.”

Regulatory implications of a digital transformation

The advancements in a digital transformation also spark regulatory implications that wealth management firms are seeking to address.

“We need to consider the options on both sides, in terms of the relationship manager and the client”, said Menager. “For regulators, it’s brought up considerations such as data protection and privacy. For clients, we need to ensure they understand and consent to the technology being used, their options, and their rights. So there are layers of challenges, for clients and firms alike, implicit in the new technology.”

Changes to the ceremony of the client meeting

The effects of Covid-19 have been at the heart of digital innovation in nearly every industry. In the case of client management, the pandemic has transformed what was more of a seminal moment – spending an entire morning with a VIP client once or twice a year, to the new model- brief calls once or twice per month for business updates.

“Currently,” Menager explains, “that very formal moment of joining a financial institution, which was especially appreciated by the oldest generations, is not the norm. Instead, there is something a little more distanced, especially with the new generations who are more likely to use their mobiles, a zoom call or a digital signature. So the style of it, the ceremony has changed.”

New features such as secure, cloud-based communication platforms (client portals), real time analytics and digital customer onboarding are being rapidly embraced within the financial sector. “This isn’t new technology,” says Menager, “it’s simply been expedited by the pandemic.”

Learning about how institutions operate digitally is one of the things Menager is looking forward to at the Digital Integration in Wealth Management conference. “I’m interested in how the latest operations and systems work together, behind the curtain, to optimise processes such as onboarding.”

Navigating joint interests

The fine line between regulation and advancement is not always an easy one to navigate, but it happens to be one of Menager’s favourite parts of the job.

Whether ensuring recorded conversations meet GDPR compliance, that digital signatures are completed in alignment with regulation, or that vulnerable clients are protected, Menager indicates that the road to successful navigation of joint interests is challenging, but worthwhile.

“I really enjoy planning, organising, and getting objectives agreed. It involves getting different, sometimes seemingly contradictory forces to work together. But in the end, despite different interests, stakes and personal motivations, we create a solution that is in everyone’s interest”.

JM Finn, like many firms, has navigated digital transformation, while remaining vigilant about matching client needs and interests to the way services are delivered.

Digitalisation and human factors in wealth management

Menager is clear that there isn’t one solution for everyone. “For example, a client may have difficulty reading the smaller print in a validation”, he says. “In this case, perhaps we need larger font for this client.”

“And the portal is easy, straightforward; you get the information in real time, but what of the client who has never touched a computer? Yes there will cases where actually paper is probably the best way for them to understand their portfolio.”

So successful front and back office operations in terms of wealth management include both digital and human factors. The right technology enhances both the operational efficiency and the client relationship.

If interested in upcoming financial services events, you can find a list of relevant options on a variety of industry related topics here.