Wealth managers across the world are speeding towards digitisation, as we learn which sectors are in line for a robotic takeover by the end of 2023.
While only a third of wealth managers have already started using artificial intelligence within their firms, 99 per cent plan to deploy the technology within the next three years, according to a report from Forbes Insight and banking software provider Temenos.
When asked what are the most popular areas for the technology's importance in delivering results, the top spots included increasing cybersecurity at 75 per cent, reducing costs at 73 per cent, and upping portfolio returns and client communications, both at 71 per cent.
In fact, 67 per cent of high net worth individuals (HNWIs) surveyed as part of the report believe that their wealth manager should adopt some level of AI into their business immediately. More than half say that those firms which don't embrace AI will not survive.
But which areas do wealth managers think that AI technologies could completely replace humans over the next five years?
Humans vs machines - Proportion of global wealth managers
- Forecasting - 67%
- Portfolio management - 56%
- Office operations - 56%
- Risk management - 51%
- Investment advice - 49%
- Client communications - 48%
Attitudes towards digitisation vary by geography, with 80 per cent of wealth managers in the Asian-Pacific region in the process of testing or deploying AI in their companies, compared to 67 per cent in Europe and 50 per cent in North America.
“Looking ahead, we expect AI to gain further traction across wealth managers serving both the HNWIs and the mass affluent markets," said Steen Jensen, European managing director at Temenos, in a statement to City A.M..
"The former are looking for greater transparency and quantitative modelling, whilst mass affluent investors are able to have access to a manager at a more affordable cost.”