How wealthtech has transformed investing habits

Wealthtech has unlocked new business opportunities in India’s wealth management sector. It has enabled high-earning millennials, who have an inherent sense of money management and technology, to drive a new wave of investment.

“Technology has democratised advisory services. These were previously available only to HNIs and Ultra-HNIs. In the past few years, advisory services have become accessible to everyone,” Vishal Bhatia, CTO of Kotak Cherry, the wealth management platform of the Kotak Group, said at our webinar last week. Bhatia has played a key role in developing Kotak Cherry as a DIY (do-it-yourself) investment platform across a wide suite of products including mutual funds, stocks, bonds, IPOs, deposits, savings, NPS, international equity, and others.

Bhatia said the pandemic has changed people’s approach to investing in three ways. Digital content, he said, has become indispensable, which has ensured customers’ habits have changed, and encouraged many to spend more time and invest on wealth tech platforms. The second, he said, is that many new investors have come in who believe in the India story. He noted the record 100 million demat accounts as of August 2022. Earlier, investors were booking mostly bank deposits, but now, young millennials are looking for higher interest and they’re looking for products that will help them achieve their goals. The third change, he said, is customers’ trust in digital platforms has grown.

Rishi Aurora, senior partner and financial services sector leader at IBM Consulting, India & South Asia, said trust and personalisation are key to onboarding more customers. Technology, he said, plays a central role here. IBM’s cognitive framework, he said, focuses on multiple areas. It starts with the digital experience, ensuring that the banking and wealthtech apps are designed in a way that they are as good as the best apps on a customer’s phone. It focuses on not just the frontend, but also on the entire workflow, making them truly digital, with little manual interventions. “If I come to your app, how can you help me close transactions? How can the workflows and journeys be made very simple? How can we provide persona-based responses that are underpinned by data? AI plays a very important role in all this,” he said.

Customers, he said, also want a broad portfolio of offerings. Here, APIs can bring an entire ecosystem as an integral part of the app. The app has to be scalable too. So, the entire tech architecture has to be designed to enable that, Aurora said.