The Changing Landscape of Wealth Management

The cost of providing services to customers has significantly increased since the 2008 financial crisis.

Traditional financial planners are losing out on new customers and income to businesses that are nimbler and have lower overhead. This is because the old-school methods aren’t cutting it for new-school investors, even if more wealth is entering the market than ever.

This piece will cover the key things you need to know about the changing landscape of the wealth sector and also answer some common questions about business transformation in wealth management.

How the Landscape of Wealth Management is Changing

In times past, clients had a banker, an insurance agent, and an investment advisor. The desire for a new service model from the customers, however, led to the creation of financial advisors.

A financial adviser is a single individual with expertise in each of the three fields of banking, insurance, and investments.

The wealth management landscape changed over a decade ago. This is because technology has made information accessible and free.

Because some investors view advice as a commodity, it is now possible to get the services online. These services include financial investment information, banking transactions, and safeguarding assets with insurance.

Without an advisor, though, you risk skipping some important phases in your investing decisions if you disregard financial services.

The investors of today desire a smooth, individualized, pro-active experience of the modern world.

And because standardized digital interactions make today’s clients feel like they’re “one of a million” rather than “one in a million,” traditional wealth managers typically fail to deliver this experience.

Consumers still want advisors to generate more while offering account management services and a flawless client experience, even if trust among first-time investors is at an all-time low.

As a result, businesses reliant on outdated technology won’t exist in the years to come.

Key Factors in Wealth Management

Although there are different factors that necessitate wealth management, I will list below the major drivers or factors in WM.

1. More Regulations and Compliance Requirements

When we think about investment, a lot of rules and regulations are alien to us. Therefore, to deal with all the regulations and compliances, we have to get the legal proceedings out of the way.

This is where the wealth managers provide value by applying knowledge to help clients navigate all the legal proceedings.

2. Variety of Financial Products

In today’s scenario, there aren’t just one financial product layer to invest in. Rather, there are many options, and it can get complicated sometimes when we want to choose a financial product.

In this case, you need the expertise of the wealth managers who’d make proper analysis which will help decide the financial product for you to invest.

3. Demand for Diversification of Investments

This is essential to today’s growing need for wealth management services, among other things. The diversification of an investment is necessary when we discuss raising the value of our assets to receive greater returns.

For instance, you could choose to invest in an asset class that ultimately performs poorly, which might result in losses.

Therefore, it is preferable to diversify your investment across several asset classes and industries in order to cope with losses. In this manner, other sectors may perform well even if one area doesn’t.

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The Most Common Changes in the WM Landscape

The paradigm shift in the wealth sector now sees investors prioritizing transparency and risk management. Below are the common changes in the WM Landscape.

1. Challenges Within Organizations

The wealth management industry hasn’t been able to effectively translate its many potentials into viable business ideas.

Due to a collision of structural and cyclical factors, revenues, margins, and costs have all experienced significant pressure. The customer has access to top-notch guidance at their fingertips for a significantly discounted price. Increased digitization has made this feasible.

As a result of greater regulatory scrutiny and legislative reforms, the wealth management industry has also experienced significant problems.

2. Technological Advancements

The availability of advice and individualized financial solutions, which were formerly more exclusive to wealthy individuals, has increased.

Due to the rising digitalization of the advising system, the lower strata of wealth customers who were previously provided standardized investment solutions now have access to professional investment advice at a significantly reduced cost.

3. Behavior of Clients

In the current situation, the client’s expectations of appropriate and tailored counsel play a key influence in the decision to work with a wealth manager.

Additionally, advice that was previously restricted to investments and was more generic in nature has expanded to include liabilities, succession planning, taxation, risk management, and even as specific as budgeting and spending controls.

Wealth managers’ recommendations focus more on controlling risk and meeting client needs than they do on simply analyzing the performance of a portfolio of assets.

In order to satisfy their investment needs and guarantee that their objectives are in line with the shifting market dynamics, investors expect simple and convenient processes.

As a result, the wealth management industry is investing a lot in technology to expand its market and meet the rising demand for financial solutions.

Read our blog on: Challenges in WM industry and How can Tech Reshape it

Questions Relating to Business Transformation in Wealth Management

Q1. How should businesses see technology?

Technology is a major component in the modern-day transformation of wealth management. Because of this, businesses should view technology as an invention that can both serve a useful function and be sustained over time.

Wealth management firms should integrate newer technologies and do away with traditional methods. Technological/infrastructural advancements made should also be scalable to handle vast amounts of data and analytics.

Q2. Transformation initiative should begin at which level?

Aligning the teams and obtaining executive sponsorship from the top, where a specific set of mandates are specified for the teams, is the first stage in beginning a transformation project.
Once this is finished, you may compare your systems to the latest systems in the industry to determine whether or not you need to upgrade them.

Q3. What challenges are associated with WM Platforms?

Many wealth managers really require change, and they must get active and keep up with the trends.
The evolving client demands is an obvious challenge as well as the need for increased resilience. Also, scalability and efficiency are other challenges.

Q4. How can wealth managers sustain platform modernization?

Agile techniques, which start with continuous integration and end with continuous testing, have been embraced by many organizations. The engineering teams must now think about improving their skills in order to work more efficiently.

Therefore, the most important aspect of this is how agile you ought to be in terms of making decisions. This implies that it’s no longer solely about being agile, but also the ability must affect your decision-making processes to ensure you are able to sustain the pace of transformation.


The wealth sector’s paradigm shift is here to stay, and wealth managers and advisers must be very adaptable to it.

The wealth management industry will undergo a paradigm shift in the next years as a result of the rising number of intelligent investors willing to place opportunistic bets and take charge of their financial destinies as well as the acceleration of globalization.

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Author: Prashant Gala
Prashant has over 15 years of experience in BFSI Industry having worked with custodian banks, commercial banks, investment banks, asset managers, research firms and financial services firms. His expertise lies in multiple products and markets like equities, fixed income instruments, derivatives, mutual funds, hedge funds, ESG/SRI ratings, passive investment market etc. At Indium, Prashant is an integral part of pre-sales consulting team and has strengthened client relationships, domain knowledge for the team, and guides the success of high-performing teams.