IBS Journal October 2016
11
FinTech keeping WMs up at night
against the likes of Apple, Amazon and Alibaba, in addition to their traditional rivals. That was a key message to come from the Wealth Management Association’s (WMA) inaugural FinTech conference, which took place in September at KPMG’s London Canary Wharf HQ.
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The event hosted five FinTechs (Delio Wealth, Novastone, BondIT, Robur and StockViews) who won a competition held by WMA to showcase digital innovations and discuss the role these companies are playing in shaping the wealth management industry. Global Co-Head of Fintech at KMPG, Warren Mead, highlighted the opportunities and threats posed by new entrants. “Wealth managers need to reassess who their competitors are – Silicon Valley is coming for them. Some tech companies want to collaborate with established firms but others want to steal their lunch,” he said. “In the long-term, the industry needs to make itself more relevant to people’s everyday lives. Looking a decade ahead there’s a real risk that traditional financial services could be completely invisible to consumers. Take Apple Pay, for instance: many people associate it with Apple and totally forget about the bank that sits in the middle.”
Alderman Professor, Michael Mainelli, Executive Chairman & Renowned Independent Expert on Blockchain, discussed the impact of mutual distributed ledgers on the wealth management industry in general and on securities in
ealth managers are now competing
particular. He commented: “Blockchain is over 20 years old, but it has risen to prominence in financial services due to Bitcoin. A lot of people in finance like to think they are ahead when it comes to technology, but the reality is that they are behind. The benefits of a blockchain ledger is that it is unable to be changed, and that it is mutually owned. Blockchain is not a silver bullet: it will not save industries that are struggling to adapt to technology. The industry needs to have the willpower to change.”
Robo-advisors came under the spotlight during a panel which consisted of Pete Connell, Managing Director of Wealth Wizard, Dr Joseph Hine, Strategic Adviser of Crealogix and Giovanni Dapra, Co-founder and Chief Executive of Moneyfarm. Connell argued: “Robo-advice comes down to choice. Choice as a consumer, as a wealth manager and additional choice of players who are entering the market. Wealth managers have three options: they can create, buy or rent FinTech technology. Buying FinTech companies to incorporate technology is popular, but wealth managers have to be careful they do not quash the culture of innovation.” Hine added: “Innovation from within, as a business model is a challenge; as it is not common for innovators to understand the day to day reality and legal frame work of financial services and vice- versa.”
Scott Thompson
www.ibsintelligence.com
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