Wednesday, 29 June 2016

Fintech is Changing Faster Than Ever And It’s Still Not Fast Enough

Most of the wealth that is being managed today is for the older generation and not the current digital generation. With advancing technology and gradually more millennials investing their money, "the existing model with fees and the opaque process" can no longer stand. Ian Lloyd, the head of operations at TT International stated recently. 

Credit: Travis Cross
Lloyd addressed the issues of "inhibiting" financial technological innovation. He accuses regulation as a barrier to new finance technology. "The industry’s lack of investment in financial technology is because asset managers still predominantly cater to older generations, with the average client age being 62."

The shift will soon switch over from investments with the older generation to investments with the digital generation. Once the cycle moves to the new tech savvy millennials, they will expect models and processes to make "things quicker, simpler and more automated."

Earlier this year, the UK's Financial Conduct Authority (FCA) launched a 'sandbox' initiative that allows fintech firms a "grace period" to establish new practices and technologies before being compliant. Fintech firms must embrace the new, high-tech and efficient practices that reduce costs and make investing more transparent. "At the moment, regulation is very manual, box-ticking and an onerous process. Regulators need to stand back and allow (fintech firms) to enter the market and establish itself before applying regulatory pressures."

Andrew Grill, a global managing partner at the tech giant IBM predicts the new "Uber" idea and technology will disrupt the industry and force it to change its business model. Fintech firms adopting these new models, like Just Service Hong Kong has, will allow the sector to simplify its regulatory compliance process. Asset management industries will have the opportunity to develop its own automated services and provide customers high-value transparent investments.

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Just Service Hong Kong is a member of the Hong Kong Confederation of Insurance Brokers in Hong Kong, transacting Long Term (including linked long term) Insurance business. Nothing in the comments above should be taken as offering investment advice or making an offer of any kind with regard to financial products or services of any kind. It is therefore important to reinforce that all comments above are designed to be general in nature and should not be relied upon for considering investment decisions without talking to licensed advisers.

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