The two big themes for the Indian wealth management industry
The mobile phone has come a long way — from being a communication device to being a source of information to becoming a platform on which you can interact and transact. And it is this trend that is likely to become a key driver for the Indian wealth management industry. From making payments to checking our portfolio to even buying financial products like mutual funds at a gentle touch and swipe, mobile is making the wealth management industry look at advisory in a whole new way. And with players like PayTM & PhonePe offering mutual funds on their mobile app platforms, investment in financial assets really looks all set to take a quantum leap.
According to Patrick Donaldson, head of Wealth Management, Asia Pacific at Refinitiv, global wealth managers are looking at technology to build scale while keeping advisory customised at the same time.
“AI & machine learning is seeing rapid adoption by global asset managers & advisors. Data can help companies build scale while keeping the basic objective of wealth creation at the centre of all advisory”
The other big learning for the Indian mutual fund industry over the last one year has been in the fixed income market. Almost 10 months of defaults, downgrades, and credit tightness later, the market is realising the importance of having advance indicators that can reduce risk.
“India is becoming aware of the need for independent valuation in the fixed income market,” says Arun Prasad, proposition sales leader, Refinitiv.
“Money managers are realising that relying on rating agencies alone is no longer enough. One needs to go deeper into market data and look at indicators like market colour which offer insights into instruments which aren’t very liquid and not traded very frequently”
Prasad says the global practice of independent valuation is likely to catch on within the Indian financial market as well. At a time when the fixed income market still appears fragile, trust carries a high premium. A better, more transparent way to value and mark to market securities will perhaps be the key focus of Indian asset managers in the days to come.
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