WEALTH MANAGEMENT PLATFORM MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

Wealth Management Platform Market Size and Trends

The Global Wealth Management Platform Market is estimated to be valued at US$ 5.84 Bn in 2024 and is expected to reach US$ 15.32 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 14.8% from 2024 to 2031.

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The rapid digitization and growing online trading activities are some key factors driving the sales of wealth management platforms. There is rising adoption of robo-advisory and virtual financial assistance solutions among end users to manage their wealth efficiently. This in turn is positively impacting the revenue generation in the industry. Managed account solutions and reporting capabilities offered by leading platform providers are further augmenting their demand. Continued technological advancements in big data analytics and AI will continue creating lucrative business opportunities for market players in the coming years. Increasing internet proliferation in developing nations also provides an impetus to revenue growth of wealth management platform market.

Drivers of the Market:

Increasing competition among wealth management firms

The global wealth management industry has seen tremendous growth over the past decade, driven by rising high-net-worth populations across major markets. With more money flowing into the sector, competition has increasingly intensified among wealth managers of all sizes to attract potential clients and their assets. Large incumbent players have expanded their existing offerings while also making select acquisitions to bolster their capabilities and reach. At the same time, there has been a rise in new independent and boutique advisory firms mounting challenges with more personalized services. With clients having more options than before, retaining existing ones and acquiring new high-worth individuals has become highly competitive. Wealth managers recognize the need to deliver more robust and technologically advanced solutions to clients. This has fueled greater demand for versatile wealth management platforms that can help streamline operations, power digital interactions, and provide comprehensive insights into client holdings and performance. Platforms offering consolidated views, sophisticated planning tools, customized client experiences, and robust security are increasingly sought after in such a competitive landscape.

Market Concentration and Competitive Landscape

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Changing needs and expectations of younger client segments

Along with growing affluence across emerging markets, the makeup of the global high-net-worth population is also changing as younger generations of clients assume greater wealth responsibilities. Younger clients today have been brought up in a digital era and have priorities very different from past generations. They expect swift, engaging, and personalized interactions across any channel resembling their day-to-day experiences. Catering to the needs of millennials and younger clients essentially requires a complete overhaul of how wealth management services are designed and delivered. While traditional advisory models focused heavily on in-person meetings, research reports and newsletters, the new demographic wants planning administered through streamlined digital access mirroring everyday apps. They also have greater emphasis on sustainability, impact and tech-enabled goals like healthcare expense projection. Comprehensive wealth management platforms providing customized digital experiences, automated goal-based investing as well as integrated ESG capabilities have therefore emerged as a necessity for advisory firms to attract and retain clients of the future.

Key Takeaways from Analyst:

The global wealth management platform market is poised to grow substantially over the next decade driven by rising high net worth individuals globally. Increasing demand for sophisticated investment management and financial planning tools from affluent clients will drive platforms to offer robust technologies and customized solutions. North America currently dominates due to early adoption however Asia Pacific is expected to show strongest growth.

Platforms continue enhancing their goals-based financial planning capabilities and portfolio management tools to attract more client asset inflows. Integration of alternative datasets into risk management and lending decisions presents an opportunity for platforms targeting entrepreneur clients. However, fragmented regulations across regions pose a challenge for expanding globally. Collaboration with local brokers can help platforms penetrate new markets faster.

Rising popularity of robo advisory solutions especially among young High-net-worth individuals (HNWIs) is compelling traditional wealth managers to either develop or partner with FinTechs providing such services. This has led to more wealth and asset management companies to white label existing wealth management platforms. Platforms integrating advanced technologies around AI, ML and data analytics stand to gain in the long run. Open banking trends also create opportunities for platforms to offer hyper-personalized bundled banking and investment products. While security and privacy remain top concerns, platforms improving customizable client experiences through intuitive interfaces will have an edge.

Market Challenges: Lack of customized product and service offerings

Lack of customized product and service offerings is significantly restraining the growth of the global wealth management platform market. Wealth management firms traditionally adopted a one-size-fits-all approach in providing their services and products to clients, without tailoring them to individual needs and preferences. This has led to a lack of personalization in the offerings. Clients, especially high net worth individuals, increasingly demand a customized experience from their wealth managers. They want recommendations, advice, and solutions that are personalized to their specific financial goals, risk appetite, liquidity needs, and other unique circumstances. A standardized approach is failing to meet this rising demand for customization.

This inability to deliver customized services and products is negatively impacting client acquisition and retention rates for wealth management firms. Clients seeking personalized wealth management solutions are reluctant to commit to firms that cannot adapt their offerings according to individual client profiles. Instead, they are exploring alternative options from competitors that emphasize customization. There is also a risk of existing clients shifting their assets to other providers if their current wealth manager cannot adjust product strategies, advisory services or investment selections according to evolving personal needs over time. Providing a one-size-fits-all experience limits client loyalty and longevity of relationships in the long run.

Market Opportunities: Growing adoption of robo advisory solutions

The growing adoption of robo advisory solutions present a huge opportunity in the global wealth management platform market. As technologies become more sophisticated, robo advisory solutions are gaining popularity among investors as they provide low-cost, automated wealth management services. These digital advisors use algorithm-based portfolio management tools which can build and manage investment portfolios for clients without the need of constant human supervision.

Robo advisors offer various advantages over traditional wealth managers. They charge very low fees, often around 0.25-0.5%, making investing affordable for masses. As robo advisors are powered by automation, their services are available 24/7 and they can manage even small portfolios efficiently. This helps expand the reach of wealth management to general population and young investors. Furthermore, studies show robo advisors develop unbiased investment models without emotional influence that can often impact human advisors' decisions. Their investment strategies are based only on past market trends and performance of asset classes.

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Insights By Advisory Mode - Demand for Expert Guidance Drives Human Advisory

In terms of advisory mode, the human advisory segment is expected to hold 38.5% share of the market in 2024 owing to clients' demand for personalized guidance from experienced professionals. As wealth portfolios become increasingly complex comprising of diverse asset classes from stocks and bonds to alternative investments, individual investors seek customized wealth management strategies tailored to their specific financial goals and risk appetite. While robo advisors offer low-cost solutions, they are unable to match the customized advice and hand-holding provided by qualified financial advisors. This is particularly important for affluent clients managing large portfolios or those with complex needs around estate planning, tax liabilities, and entrepreneurship, etc.

Human advisors stay abreast of constantly changing macroeconomic, geopolitical and industry conditions to adjust recommendations accordingly. They draw upon their educational qualifications as well as years of experience interacting with different client profiles to craft nuanced plans. Advisory firms focus on recruiting seasoned professionals with certification such as CFA or strong industry pedigrees to attract and retain High-net-worth individuals (HNWIs) clients. The human touch along with accountability of a named advisor also help address clients' emotional aspects around their wealth. This personalized engagement model has proved more effective in building long-term trusting relationships compared to bot-driven interactions.

Insights By deployment - Cloud-based Platforms Enable Flexible & Scalable Operations

In terms of deployment, the cloud-based platforms segment is expected to hold 64.1% share in 2024 driven by their advantages over on-premise systems. Wealth and asset managers prefer the flexibility, scalability and lower upfront costs offered by cloud infrastructure. It allows them to avoid large capital expenditures on hardware, software, and support staff required for maintaining on-site servers. Cloud providers are responsible for ensuring system uptime, capacity, data security and upgrades through a pay-per-use model. This enables wealth tech firms to keep operational costs variable based on business volumes rather than be saddled with unused on-premise capacity.

Cloud solutions also facilitate collaboration through unified data environments accessible anywhere. Teams can securely access client information and manage portfolios from any internet-connected device. Hybrid work culture fostered during the pandemic has further enhanced demand for flexible, remote working tools. Cloud platforms seamlessly integrate with other third-party applications for goal-based financial planning, risk-profiling, portfolio rebalancing, etc. Their scalable architecture supports rapid onboarding of new clients and advisors without infrastructure limitations. This helps wealth managers serve more customers and geographical regions with the same cost base. Overall, cloud-based platforms have emerged as the preferred setup over on-premise systems to drive efficiencies across wealthtech operations.

Insights By end-use industry - Banks Deploy Wealthtech to Enhance Customer Experiences

In terms of end-use industry, the banks segment is expected to hold 45.2% share of the global wealth management platform market in 2024 owing to their initiatives to strengthen wealth management offerings. Traditional banks are facing intensifying competition from dedicated wealthtech disruptors as well as robo advisors/fintech entrants providing superior digital experiences. To ensure client retention, banks are investing in adopting wealth management platforms that integrate financial data across their wide service portfolio. This helps deliver a holistic view of customers’ assets and liabilities for comprehensive wealth planning and advice.

Platforms enable banks to offer value-added wealth management propositions at various relationship tiers. Mass market clients have access to basic advice and investment options through online portals. Priority segments receive dedicated wealth planning from relationship managers assisted by goal-based wealthtech tools. For HNWI individuals, banks deploy goals-based planning, portfolio management, trust/succession solutions through a unified platform approach. This upgrade of services and relationship models helps banks deepen client engagement beyond transactional account holders. With increasing affluence in emerging markets, banks also utilize platforms to expand product offerings and improve overseas client servicing. Overall, wealthtech provides a competitive edge for banks to leverage data insights and deliver enhanced customer experiences.

Regional Insights

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North America has established itself as the dominant player in the global wealth management platform market. The region is expected to account for 35.9% of the market share in 2024. This can be attributed to the presence of major financial institutions and high disposable incomes in the region. The U.S. accounts for the bulk of the wealth management market in North America due to the country's large economy and wealthy population. American individuals and families tend to have substantial investments that require sophisticated wealth management solutions. Moreover, wealth and asset managers in North America are quick to adopt new technologies to enhance their service offerings and gain competitive advantage. They regularly invest in upgrading their platform infrastructure to provide clients with seamless connectivity and around the clock access to financial portfolios and advice.

The Asia Pacific region has emerged as the fastest growing market for wealth management platforms globally. This meteoric rise can be explained by rising affluence, increasing number of high net worth individuals, growing financialization of savings, and changing risk-return preferences of investors in the region. Countries like China and India have experienced accelerated economic growth and wealth creation over the past decade. This has spurred demand for tailored wealth management services among affluent individuals and families in Asia seeking to preserve and expand their wealth. Platform providers have capitalized on these dynamics by establishing local operations, launching innovative solutions and forging partnerships with domestic banks and asset managers. The nascent yet rapidly evolving wealth management ecosystem in Asia Pacific fuels platform adoption as financial institutions digitalize to serve modern investors.

Market Report Scope

Key Developments

• In June 2023, PureFacts Financial Solutions, a leader in revenue management solutions for the investment management industry, announced that its fee and billing calculation engine would be integrated into Pershing X's Wove wealth management platform, a technology provider and new business unit of BNY Mellon. This integration will enable wealth management organizations using the Pershing X platform to better account for every dollar of value with less overhead and more automated, accurate, and repeatable workflows.
• In February 2023, South Indian Bank, a leading Kerala-based private sector bank with a nationwide presence and a legacy of over nine decades, partnered with Geojit Financial Services, one of the leading investment services companies in India with over 35 years of experience, to build a wealth management platform. SIB Wealth aims to assist the bank's high net worth (HNI) clients by investing their funds in the best financial instruments available in the market. The platform offers portfolio management services, alternative investment funds, systematic investment plans, mutual funds, bonds, real estate funds, and structured products.
• In February 2023, Wells Fargo & Company, a leading financial services company with approximately US$ 1.9 trillion in assets and serving one in three U.S. households, introduced a digital platform for consumers with wealth management accounts. The LifeSync platform, available on the Wells Fargo app, will assist the bank's 2.6 million wealth and investment management (WIM) clients in planning and tracking their finances. This platform will be available at the end of March.
• In January 2023, YieldX, a Miami-based fintech startup providing fixed-income portfolio management technology, optimization services, and direct indexing tools for wealth managers, was acquired by FNZ, a global wealth management platform headquartered in New Zealand that administers over $1.5 trillion in client assets representing 20 million investors worldwide. YieldX's cutting-edge capabilities, which will be integrated into FNZ's wealth platform, will enable clients to scan the global universe of fixed-income opportunities and quickly identify outcomes that match their desired terms and yield based on their risk profile.
• In March 2023, WealthTech GBST, a global provider of financial services technology to the capital market and wealth management sectors, rebranded and released an improved SaaS Composer wealth management administration software version. In reference to its roots, the company has kept its name while developing a brand strategy and new visual identity based on the updated backronym.

*Definition: The Global Wealth Management Platform Market provides a technology platform and solutions that allows wealth managers, financial advisors, and private bankers to manage high-net-worth clients' financial assets. It offers customizable portfolio management, financial planning, investment management, custodial services, and performance reporting capabilities in an integrated web-based system. The global wealth management platform market caters to the banking, financial services, and insurance industries worldwide to efficiently manage the complete financial lifecycle of high-net-worth individuals and their families.

Market Segmentation

• Advisory Mode Insights (Revenue, US$ Bn, 2019 - 2031)
• • Human Advisory
  • Robo Advisory
  • Hybrid
•  Deployment Insights (Revenue, US$ Bn, 2019 - 2031)
  • Cloud-based
  • On-premises
•  End-use Industry Insights (Revenue, US$ Bn, 2019 - 2031)
  • Banks
  • Investment Management Firms
  • Trading & Exchange Firms
  • Brokerage Firms
  • Others
• Regional Insights (Revenue, US$ Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East & Africa
    • GCC Countries
    • Israel
    • South Africa
    • Rest of Middle East & Africa
• Key Players Insights
  • Avaloq Group AG
  • Backbase
  • Broadridge Financial Solutions, Inc.
  • Comarch SA
  • Dorsum Limited
  • FIS
  • Fiserv Inc.
  • InvestCloud
  • InvestEdge, Inc.
  • Profile Software
  • Prometeia
  • SEI Investments Company
  • SS & C Technologies, Inc.
  • Tata Consultancy Services
  • Temenos Headquarters SA