Digital has permeated into seemingly every industry. With Retail & FMCG / CPG initially trailblazing digital transformations across the world, other industries have caught up to a large extent. This is largely true in Indian markets as well where the forays of Amazon & Flipkart, combined with cheap cellular data revolutionised by Jio and digital payments spearheaded by the current central government, ushered a digital approach to selling and buying. Financial, insurance, and media companies have also been active in undertaking digital-first approaches to their business models.But within the financial industry, this transformation has mostly been prevalent in the banking sector. However, the fund management industry has lagged. Many of them still stick to an “offline relationship” approach that has worked for eons. But that approach may suffer going forward. In India especially, where more millennials are investing in funds and many newer high net worth individuals (HNIs) are millennials, it is imperative for the fund industry to play catch-up and quickly. It almost feels like your organisation is archaic if you are not on the digital bandwagon.Today’s smartphone-savvy consumers have been clamouring for digital offerings from the fund management industry as well. They have tasted the digital goodness the other industries offer and want to see the same for wealth and fund products as well. They expect everything to be available at their fingertips on their smart devices. The new-age investor wants things to turnaround quickly - financial information available on-demand, multiple choices offered, intuitive information, and digital transactions. They want what works for them and not just what works for the assets or wealth institutions. They do not want to be encumbered with limited options sold at the behest of these institutions but want to be spoiled with choices. This is true not just in India but worldwide as well.Here are a few areas where fund management falls short of the new-age consumers’ expectations:
Fund management players should worry about the old-school mentality that they continue to run with. Consumers and investors will naturally gravitate towards more cutting-edge digital solutions that offer the same upside than the uninspiring value adds that these traditional institutions offer. We believe, it is just a matter of time before the cracks start to widen.