The Cloud Revolution: How to Unlock Opportunities in Wealth Management and Private Banking 

by | Jul 20, 2023

Written by Vikas Srivastava, Chief Revenue Officer, Integral

2023 has been a year characterised by both opportunities and new-found risks for firms in the wealth management and private banking sector.

While grappling with slumps in growth, high interest rates, and bouts of severe market volatility, the industry has no option but to evolve to meet the changing needs of their customer base. 

Currently, wealth managers are riding a wave of new industry trends. As the client demographic shifts, customer experience always remains a critical consideration. According to a report by Cerulli Associates, it is projected that wealth transferred through 2045 will total $84.4 trillion. This generational wealth transfer is seeing younger investors establish new relationships with their wealth advisors. Used to dealing with technology for all aspects of their life, they expect the best and most efficient service from those in charge of their portfolios. In addition, they are also turning their attention to new asset classes, such as digital assets and cryptocurrencies.

To meet these changes, firms need to adapt their strategies and services accordingly, to streamline operations and ensure they can provide cutting-edge investment opportunities in a way that matches up with the needs of their increasingly tech-savvy client base. To stay ahead, private bankers and wealth managers need to realize the potential of technology, reaping all the benefits of automation without the significant costs of having to build their own infrastructure in house. 

Key industry drivers, such as digital transformation, are now having significant impacts on the industry. As part of this, and shown by the survey from Publicis Sapient on the Future of Cloud in Banking, many retail and commercial banks have big ambitions to increase the number of applications and data that are hosted in the cloud. This signals major acceleration, compared with pace of adoption over past years. The cost-benefits of adopting cloud technology are rather well known now, namely driving forward innovation and reducing total cost of ownership. Many in the wealth management and private banking space should be viewing this as the strategic next step for their business. 

From a macro perspective, cloud-hosted SaaS can act as a democratizing force for firms operating across the spectrum of FX and capital markets globally. Why? Because it is synonymous with agility and flexibility. The lower costs, coupled with high-quality technology, enable regional and national institutions to compete and win on a global scale. Each institution, no matter their size, ends up with access to technology usually found at tier 1 Wall Street institutions. SaaS easily accommodates workflows to meet unique business requirements, while also maintaining rigorous standards to meet technology needs in a timely and efficient manner. 

There is certainly room for growth – technology providers can help companies in the private banking and wealth management space to maximize operational efficiency and better serve their existing customer base. Relying on flexible and scalable SaaS technology, smaller and traditional organizations can realise the benefits of institutional grade technology to navigate new and increasingly complex customer requirements, from sourcing the best FX rates intra-day to automating their risk management capabilities. Only with SaaS technology can wealth managers gain a competitive edge, modernizing operational processes and ultimately growing their business along the way, at a fraction of the price of building your own infrastructure.  

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