How Fintech Is Disrupting Wealth Management


With the development of the Internet, the field of money management has also changed significantly. The financial advisor model began to transform as early as the 1970s, gradually transforming into mutual funds. In the 2000s, the active development of the Internet and the automation of money management began, and now intensive progress in this industry continues, which has created new roles for financial advisers.

However, despite the fact that a moderate increase in the number of people representing the financial consulting industry is expected in the near future, an alternative is already emerging for them. The development of fintech contributes to the emergence of new investment management technologies. Let’s talk about innovation in wealth management in more detail.

Fintech is evolving

Every year, fintech gets more support from developers and investors. This is evidenced by the amount of investment that such projects attract. The KPMG Pulse analytical group has calculated the volume of capital investments for 2021. According to the researchers, the investment amount amounted to 210 billion dollars. To date, the most popular areas of fintech are:

  • Payments.
  • Cybersecurity.
  • Insurance.
  • Regtech.
  • Blockchain and cryptocurrencies.

Separately, it is necessary to single out the sphere of robotic consultants. These developments are designed to compete with people who are engaged in financial consulting. In 2019, funds invested more than $4.5 billion in this industry. According to experts, by 2027, the industry’s investment will exceed $41 billion.

Artificial intelligence is being introduced into fintech wealth management

The development of robot consultants, like other areas of fintech, is facilitated by progress in the field of artificial intelligence. Many leading developers pay attention to this area. For example, Salesforce developed a project called Einstein and became one of the pioneers in this area. In turn, IBM Watson and H&R Block signed a partnership agreement and are preparing their developments in the field of fintech and robotic consultants.

The speed with which fintech is being introduced into the fintech space impresses many experts. They make things much easier for clients, and the level of analysis AI tools are capable of is growing every month. Therefore, investors with large capital willingly invest in such projects, which in turn accelerates the development of these projects.

What does fintech mean for wealth managers?

What does fintech technology mean for financial advisors and wealth managers? First of all, they help in working with investors. Investors expect such technologies to become an important means of communication. It is convenient for them to cooperate with managers online, and fintech services are one of the digital tools they are used to in life.

Through advertising from Betterment and other firms, investors have access to modern and understandable tools that provide high performance. Development in terms of user design has also become an important factor in favor of the fintech industry.

It is convenient for consultants to work with clients online because not all of them can come to the office and get advice on the spot. The use of fintech makes the sphere of financial consulting much more efficient, providing communication from anywhere in the world. Consultants can provide the client with all the necessary information through an online service and use online collaboration tools. This ensures a simple and transparent interaction without spending time traveling to the consultant’s office.

In addition, fintech services help clients understand the value of a financial advisor. This is important because many clients are convinced that consulting specialists only help them distribute investments and form an investment portfolio. With the help of fintech services, wealth managers can provide clients with maximum support and unleash the full potential of cooperation.

What does fintech mean for clients?

According to a survey conducted in 2020, 41% of respondents are willing to consider using robotic advisors. Nearly half of all Millennials and Generation Z surveyed believe that a robotic advisor can work with a personal approach and make investment decisions. Among the older generations, the number of respondents who are confident in the ability of fintech advisors does not exceed 30%.

The results of this survey show the importance of communication between advisors and investors. Especially when it comes to the older generation of people who are largely distrustful of technology. Such people need communication and trust. The level of trust is a key factor in choosing a wealth manager or refusing their services.

Clients can benefit significantly from the use of digital wealth management services. In addition to transparency, the use of fintech tools makes the services of consultants less expensive. Overhead costs are reduced. For example, Charles Schwab Corp offers a robotic advisor to its clients. The cost of its services is 28 basis points but not more than $3,600 per year. With an investment of $5,000 or more, the product includes automatic rebalancing, as well as full accounting for all tax expenses. There is also a premium service package, but it is intended for large investors (with an investment of at least $25,000).


Fintech is an area that is rapidly developing. Financial technologies are gradually penetrating all areas of our lives, and their integration will only deepen. In particular, fintech is already heavily integrated into financial consulting and wealth management fintech services.

Companies can provide the services of a robotic adviser or help organize instant contact with a real consultant. Modern technologies make the use of fintech more profitable compared to outdated methods of communication. Clients can get all the necessary information about their investments and make all the necessary decisions without leaving their homes. In addition, the development of fintech is also facilitated by artificial intelligence, which is also being actively introduced into this area. Experts predict further growth in investment in this area. Interest in it is already observed, and we should expect further growth in demand for fintech asset management.

Similar articles