A number of established financial services providers – including BNP Paribas Asset Management, Aviva, and BlackRock – have recently showed interest in working with robo-advisers. But they must take care to ensure a work culture that is open to innovation if they are to reap the benefits of new technology.

More and more established providers are buying into fintech disruptors such as Gambit, Wealthify, and Scalable Capital. Incumbents seem to be finally embracing new technologies to digitalize communication channels and portfolio management.

Partnering with fintech disruptors provides a path to drive innovation and enhance the client experience, as well as attracting new demographics like digital native millennials. It also allows companies to provide high-quality digital solutions in a timely and cost-effective manner.

As per GlobalData’s 2017 Global Wealth Managers Survey almost 50% of private wealth managers globally are already partnering or planning to partner with fintech start-ups over the next two years, with this figure rising to over 60% in Asia Pacific.

Many robo-advisors have been struggling to gain scale, with client acquisition representing by far the most difficult issue. Partnerships expose them to a new client base, growing their brand reach without the need for costly marketing and advertising. For example, Scalable Capital was able to surpass $500m in AUM over the first 10 months of 2017, acknowledging that its partnership with ING in Germany was one of the main drivers to its growth.

However, innovation does not just consist of delivering digital solutions to clients

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Relationship managers benefit from back-office solutions by being able to focus more on relations with their clients, letting machines take care of administrative burdens. This is where the biggest challenge lies, as much opposition to innovation is fostered by an organizational culture reluctant to adapt to new back-office tools.

Banks need to work on the underlying company culture for these partnerships to succeed. As pointed out by panellists at the Appway Sphere for Banking event, “a technological solution can’t be bought – it needs to result from cooperation between both the provider and the organization adopting it.”

The toughest hurdle in the way of private banks’ digital capability doesn’t seem to come from compliance, but from a rooted mistrust in technology.