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Enhancing Wealth Management: Fusing AI, Robo-Advisors, and Human Expertise

Enhancing Wealth Management: Fusing AI, Robo-Advisors, and Human Expertise

“In the age of machines and wisdom, let technology guide your path, but never lose the human touch in your journey to prosperity.”

We live in an era of rising demand for wealth management, frequently without realizing it Many financial services organizations are advocating for investment management through tools like Robo-Advisors. These AI-powered systems are designed to grow our investments, enhance their security, and assist us in achieving our financial goals.

However, can AI powered Robo-Advisors truly replace wealth managers in terms of trust and portfolio balancing? What are the implications for financial services, particularly in the realm of wealth management?

The Modern Wealth Management Landscape

Modern wealth management is evolving, demanding advanced personalization, a comprehensive and holistic financial planning strategy, transparency, and a strong focus on emotional well-being. It also requires continuous portfolio rebalancing and, critically, the integration of cutting-edge technology like AI-powered Robo-Advisors. However, technology alone isn’t enough. Seamless collaboration between human expertise and AI, along with access to educational resources, are essential components for success.

The Role of Hybrid Robo-Advisory

To sustain success in wealth management with AI-powered Robo-Advisors, embracing digitization through Hybrid Robo-Advisory is crucial. Achieving true digital transformation in the industry hinges on adopting this approach. The main challenge for financial services lies in overcoming the limitations of AI-powered Robo-Advisors compared to traditional wealth or investment managers while steering the growth of the wealth management industry with technological advancements.    

Why is AI-powered Robo-Advisory with human intervention essential for the wealth management and financial services industry?

Integrating human expertise, particularly wealth managers, into AI-powered Robo-Advisory systems forms a hybrid model that offers six significant advantages for financial services.

  1. Trust and Personalization: AI-powered Robo-Advisors excel in data-driven decision-making via algorithms, but human/wealth advisors offer nuanced insights and a deeper understanding of personal circumstances. This human touch helps build trust and rapport, which is vital for clients, especially during significant financial decisions or periods of market volatility.
  2. Emotional Support through In-Person Interaction: Human advisors provide emotional support that encourages long-term thinking and helps clients feel more secure and confident in their investment choices. This support is essential for avoiding impulsive decisions driven by fear or greed. Unlike Robo-Advisors, this emotional insight is distinctly human.
  3. Regulatory Compliance and Judgment: Although AI-powered Robo-Advisors adhere to regulatory guidelines, some investment decisions involve ethical considerations and complex judgments that algorithms can’t fully resolve. Here, the expertise of wealth managers and human judgment are vital.
  4. Client Segmentation and Differentiation: High-net-worth individuals often seek a combination of personalized guidance from wealth managers and automated solutions for complex financial strategies. This integrated approach maximizes effectiveness by leveraging the benefits of both methods. Human advisors can adapt strategies in response to real-time client feedback, keeping investment plans aligned with evolving goals and circumstances. Additionally, a hybrid model addresses the diverse needs and preferences of various client segments, offering automated services for simplicity and human expertise for more intricate financial requirements.
  5. Augmented Intelligence and Continuous Development: Wealth managers can use insights and recommendations from Robo-Advisors to refine their portfolio advice, blending data-driven precision with human intuition and experience. Simultaneously, ongoing feedback helps to continuously improve the algorithms and models of Robo-Advisors, enhancing the overall advisory service.
  6. Portfolio Rebalancing & Valuation: In response to market conditions, new financial goals, or emergency fund withdrawals, a hybrid advisory model allows for effective portfolio rebalancing. Human advisors can provide the necessary adjustments and personalized strategies to ensure that the portfolio remains aligned with the client’s evolving needs and circumstances.

Embracing the Future

The emergence of hybrid Robo-Advisors is rapidly transforming the traditional field of wealth management. This industry trend leverages AI-powered Robo-Advisors to revolutionize how advisors interact with and serve clients, creating new opportunities to expand their reach across various client segments and meet diverse expectations.

At Maveric, we recognize the significant potential of hybrid coverage in wealth management, particularly for clients who benefit from human advisors but may not require the intensive 1:1 advisory relationship typically offered through traditional methods. This approach allows for a more tailored service that meets the unique needs of different investors.

Rise-of-Robo-Advisors

According to a recent report by Grand View Research, Robo-Advisors dominated the market in 2023, accounting for 63.8% of global revenue. The growing demand for hybrid Robo-Advisors is fuelled by their ability to merge the efficiency and consistency of AI-driven algorithms with the personalized guidance of human advisors. This powerful combination is poised to drive substantial growth in the wealth management sector.

As we look to the future, the integration of human expertise with technological innovation will play a pivotal role in shaping the wealth management industry. By providing clients with the best of both worlds, hybrid Robo-Advisory models will deliver enhanced value and a more dynamic, responsive approach to managing wealth.

Maveric Systems – Your Partner in Success

Maveric Systems is a leading provider of IT solutions specifically for the BFSI & NBFC sector. With our deep domain expertise and a comprehensive portfolio of AI-powered solutions, we can help your institution navigate the evolving technological landscape. We offer solutions for:

  • Customer Experience
  • Process Excellence
  • Regulatory & Compliance
  • New Age Application Management System
  • Assurance

Contact us at indiasales@maveric-systems.com to initiate a conversation about your unique requirements. Let’s explore together how we can tailor our solutions to meet your specific needs effectively.

Author:

Krithiga Kasiraman is a Lead Technical Consultant at Maveric Systems who works primarily in wealth management and capital markets sectors, particularly in Temenos Wealth. 

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A Guide to Navigating the 2024 Technology Landscape of BFSI & NBFC in India

A Guide to Navigating the 2024 Technology Landscape of BFSI & NBFC in India

The Banking, Financial Services and Insurance (BFSI) sector, alongside Non-Banking Financial Companies (NBFCs), is undergoing a period of tremendous transformation in India. Driven by factors like digital adoption, regulatory changes, and the rise of fintech, staying ahead of the innovation curve requires navigating a complex technological landscape. This guide explores some key trends shaping the BFSI & NBFC tech space in 2024 and offers insights for navigating this dynamic environment.

Top 10 Technology Trends in 2024:

  1. Artificial Intelligence (AI) and Machine Learning (ML): AI and ML are revolutionizing how these institutions operate. According to Gartner predictions report, it is said that by 2026, 75% of businesses will use generative AI to create synthetic customer data. From fraud detection and risk management to personalized customer experiences and loan underwriting, AI is streamlining processes and operations by enhancing decision-making capabilities. ML models leverage historical data and predictive analytics to assess credit worthiness swiftly and accurately, expediting the lending process at reduced risk.
  2. Cloud Adoption: Cloud computing offers scalability, agility, and cost-effectiveness. Migrating to the cloud enables institutions to deploy innovative solutions faster and leverage advanced analytics for better customer insights, and focus on their core business priorities without the burden of managing infrastructure. A recent survey stated that 83% of financial services companies already use cloud infrastructure in some capacity, and 38% choose hybrid cloud with single and multi-cloud solutions. It is highly possible that by 2026, 70% of leading banks will increase their cloud spend.
  3. Open Banking and APIs: Open Banking regulations are fostering collaboration within the financial ecosystem. By leveraging APIs to integrate with third-party fintech solutions, these financial institutions can expand their service offerings beyond traditional boundaries, enhance customer experiences, and drive innovation across multiple touchpoints, ultimately delivering greater value to customers in the digital age.
  4. Open Network for Digital Commerce (ONDC): The emergence of ONDC presents a significant opportunity for BFSI & NBFC institutions. Integrating with the ONDC ecosystem, institutions can offer financial services like microloans and payment processing to a wider range of merchants and consumers. Supporting this trend Government of India (GoI) has brought in initiatives to target registering 900 million buyers & 1.2 million sellers on the ONDC platform and generate USD 48 billion gross merchandise value (GMV) for the next 5 years.
  5. Cybersecurity: As financial institutions become increasingly reliant on technology, cybersecurity threats become more sophisticated, according to CERT-In, India’s financial sector faces on an average of 4,400 cyber-attacks daily. Implementing robust security measures is paramount to protecting sensitive customer data and ensuring business continuity. Strengthening risk planning against unforeseen fraud with AI and automation tools which can analyse synthetic data to identify emerging threats and continuously update detection algorithms to stay ahead of fraudsters.
  6. RegTech: Regulatory compliance is an ongoing challenge for BFSI & NBFC institutions. In 2022-2023, India’s regulatory framework saw 5,986 updates, averaging over 16 updates per day. RegTech solutions powered by AI and automation can streamline compliance processes, better financial reporting data models, reduce costs, and minimize regulatory penalties.
  7. Customer Experience: In today’s competitive landscape, delivering a seamless and personalized customer experience is crucial. Embracing omnichannel strategies, chatbots and AI-powered virtual assistants, can elevate customer engagement, drive operational efficiency, and gain a competitive advantage, ultimately positioning themselves for long-term success in the dynamic and evolving financial services industry.
  8. Advanced UPI: Indian Payment landscape is witnessing a rapid evolution with 59% increase in volume and 45% increase in value of UPI transactions compared to 2022. The emergence of UPI Lite, UPI Tap & Pay, and UPI Credit lines signifies a paradigm shift in the way payments are made and processed in India. These new features offer enhanced convenience, speed, and flexibility to users, empowering them with seamless payment experiences across various channels and devices. BFSI & NBFC institutions need to adopt these trends to stay relevant.
  9. Marketing Technology (MarTech): Marking advancement in India fuelled by technology like Machine learning (ML), natural language processing (NLP), large language models (LLMs), and deep learning are fundamentally changing how institutions engage with customers, analyse data, and extract valuable insights.
  10. Hyper-personalization: In a digital-first landscape, where according to a study, 86% of customers are willing to share their data for a more personalized banking experience. Hyper-personalization in BFSI and NBFCs not only enhances customer satisfaction but also fosters deeper engagement and loyalty, driving sustainable growth and differentiation in a competitive market. Through advanced algorithms and machine learning, these banks analyse vast datasets to understand individual preferences, behaviours, and needs, delivering highly targeted and relevant services and recommendations

Navigating the Landscape:

  • Identify Your Needs: Carefully assess your institution’s specific needs and challenges. What are your pain points? What are your strategic goals? Understanding your priorities will guide your technology selection process.
  • Embrace Innovation: Don’t be afraid to experiment with new technologies. Pilot projects and proof-of-concepts can help you evaluate the potential benefits of emerging solutions before full-scale implementation. Consider establishing Centres of Excellence (CoEs) to embrace experimentation in a controlled manner, maximizing benefits.
  • Prioritize Security: Cybersecurity should be at the forefront of your technology considerations. Invest in robust security solutions and ensure your systems are compliant with data privacy regulations.
  • Build a Strong Technology Partner: Partner with a reliable technology solutions provider who understands the BFSI & NBFC landscape. Look for a partner who can offer domain expertise, comprehensive solutions, implementation proficiency, and ongoing support.

Maveric Systems – Your Partner in Success

Maveric Systems is a leading provider of IT solutions specifically for the BFSI & NBFC sector. With our deep domain expertise and a comprehensive portfolio of AI-powered solutions, we can help your institution navigate the evolving technological landscape. We offer solutions for:

  • Customer Experience
  • Process Excellence
  • Regulatory & Compliance
  • New Age Application Management System
  • Assurance

Contact us at indiasales@maveric-systems.com to initiate a conversation about your unique requirements. Let’s explore together how we can tailor our solutions to meet your specific needs effectively.

Author:

Nivedha Ganeshan is an Associate Manager – India Sales handling Client engagements, at Maveric Systems.

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Translating Employer Value Promise By Building Learning Communities That Focus On Customer Value

Translating Employer Value Promise By Building Learning Communities That Focus On Customer Value

The world of work, accelerated by the pandemic, is set for a monumental transition. McKinsey predicts that 14% of the global workforce may have to switch occupational categories as digitization, automation, and advances in AI are disrupting the world of work. By 2030, companies and governments will face profound implications for setting up individuals on their career paths. The global corporate L&D market tops $350 Bn, as Gartner posits in its recent year-end report that 70% of employees feel they lack the skills required to perform well on their jobs.

Accentuating today’s need is a core reality: transformational learning, despite the investments, efforts, and excitement poured in, is hard. Companies must reach the point where their workforce eagerly (and assertively) challenges the status quo and act in altered ways to create enduring customer value. The challenge can originate from multiple sources; the learning may be misaligned with required business skills, or the metrics targeted are ineffective (course completion rates, for instance, as opposed to qualitative feedback). What is the way forward?

What elements and principles creates happy learning communities and encourage greater experimentation and effectiveness?

It is interesting to observe an employer’s value promise in setting up a conducive environment.

  1. Establishing communities of practice. The informal association of employees usually stretches across business divisions, are as diverse as the situations that give rise to them. One example could be that employees form communities of practice around the emergent areas of AI, Regulatory Tech, and Cybercrimes. In contrast to formal work or project teams, a community of practice is united through passion, commitment, and identification of the group’s expertise. Over time, communities of practice self-perpetuate – they generate knowledge, reinforce and renew themselves.

While participation remains voluntary, communities of practice are encouraged by the learning culture that an organization fosters through its employee brand promise.

  1. Ecosystem learning. In a recent example, Apple pledged $50M in supplier employee development funds to expand access to learning opportunities. The initiative supports the worker rights program created by the International Labor Organization (ILO) and the International organization for Migration (IOM). This is an example where new educational resources enhance the learning potential for specific professions and create skills necessary for tomorrow’s jobs – in an ecosystem-centered way. This external orientation is crucial in today’s hair-trigger economy, where customer preferences constantly change. Working with partners makes spotting new (and often unpredictable) opportunities easier. As unexpected challenges surface, ecosystem learning programs help organizations to draw meaningful insights from fragmentary and incoherent data. One, the employees are equipped with a sharpened sense of emerging trends, and two, they are battle-ready with necessary resources that must be quickly brought to bear.
  1. Unlearning faster than learning. More than forgetting, the discipline of unlearning involves the wisdom of choosing a fresh way of thinking. When we learn, we add new knowledge. When we unlearn, we step outside our mental models to select something new. In a networked economy, the nature of strategy and customer value creation shifts quickly and vastly. For instance, creating friction-free customer experiences for banks in an omnichannel world is about removing limits rather than setting them. Be it sales, marketing, brand, or product development teams; it is essential to remind ourselves that we operate in a multi-dimensional world, where more than B2B, B2C, D2C, and B2B2C models, the more objective reality is “many-to-many .”To transition and successfully perform in this mental model, we must embrace new mental habits (like driving on the other side of the road in a foreign country).   

Companies that practice curiosity, transparency, and non-judgmental communication (especially at the leadership ranks) do better at unlearning (often faster than learning).

In conclusion

Creating inspired, open, and free organization comes from how broad-based, inclusive, and well-permeated the employee value promises – especially the principles of care, nurture, and communication – are.

Remember, Choose Wise, Continue Wiser.

About Maveric Systems

Since 2000, Maveric Systems has been a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

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Customers or culture; leadership or learning? Making sense of the unique balance in an Employer’s brand promise

Customers or culture; leadership or learning? Making sense of the unique balance in an Employer’s brand promise

Post-pandemic employment choices proliferate with a higher acceptance of hybrid work models, especially in the technology sector. Add to it the novelty of Metaverse that brings experiments in employee experience and employer empathy.  Just as digitization and social media offer marketers extraordinary insight into customer decision journeys, for prospective job seekers, the same tools allow them to scrutinize (and hold accountable) employers’ brand promise.

What is the relationship between a company’s brand promise for its products and its employees?

Let’s talk about a few companies that have reinvented themselves over time and know something about creating and sustaining a brand promise.

  • The ultimate driving machine (BMW)
  • To bring inspiration and innovation to every athlete in the world (Nike)
  • Save money, live better (Walmart)
  • Inspire moments of optimism and uplift (Coca-Cola)
  • Think different (Apple)

These promises accentuate attributes the iconic companies offer as part of their products. Now, let’s understand these companies as employers.

  • Share your passion (BMW)
  • Move the world (Nike)
  • People, innovation, and a chance to change the world for good (Walmart)
  • A diverse, global community of people who thirst for more (Coca-Cola)
  • Join us. Be You (Apple)

Like their products, these companies emphasize a core promise it makes for their current and future hires. A secondary set of values is also a part of the EVP (employee value proposition) that actualize the key messages. For instance, Coca-Cola talks about the values of leadership – (the courage to shape a better future), passion (committed in heart and mind), integrity (be real), accountability (if it is to be, it’s up to me), and innovation (seek, imagine, create, delight)

At the heart of it – be it a product or employment – the best enterprises articulate their value precisely and practice it across customer-facing processes.

For employers, balancing a brand promise is essential. After all, making daily progress in meaningful work comes from an optimal mix of emotions and motivation.

For an enterprise with the employee brand promise – Meraki – their ability to provide a conducive environment for practice Meraki becomes essential. (Meraki is a Greek word that means to do something with passion, creativity, or love.)

The obvious question is: what must then be the components for the teams to practice this ‘essence consistently’? Here are three possibilities.

  • Exceptional projects with marquee clients that need ‘possibility thinking’ on an unprecedented scale.
  • Exceptional leadership that promotes meritocracy and role models care and nurture.
  • A environment tuned to consistent learning and adventure that challenges the status quo and prides collective accomplishment over individual excellence.

In Sum,

Today’s digital climate empowers job seekers to know the cultural nuances that differentiate enterprises. Equally, organizations, at least the progressive ones, are bringing in higher wisdom to articulate what they stand for and how their promise unfolds across functions and departments.

Remember, Choose Wise, Continue Wiser.

About Maveric Systems

Since 2000, Maveric Systems has been a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

For its employees across locations and diverse competencies engaged with marquee clients across the globe, Maveric Systems balances its customer commitments through its employer value proposition; a mix of four principles – focus on meritocracy, unparalleled care and respect, leadership nurture, and transparent communication.

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