Wealthtech, has been exhibiting robust growth in Singapore over the past few years. According to a recent KPMG report, Singapore has been leading the Asia Pacific (APAC) market in terms of wealth management owing to its advanced infrastructure and sophisticated digital capabilities among the players.
Growing investor interest, consolidation of smaller players, favourable regulations and burgeoning demand for automated wealth advisory services have also been fuelling the growth. Moreover, Singapore has become home to a growing population of ultra-high net worth individuals (UHNWIs) with a net wealth of US$30 million or more. Despite its smaller population, Singapore had the eighth highest growth rate of UHNWIs in the world, between 2018 and 2019.
In 2019, there were over 3,300 UNHWIs in Singapore, and the number is estimated to grow by 29% by 2024. Additionally, there are over 300,000 HNIs with a net wealth of over US$1 million. Since 2000, wealth per individual in Singapore has also increased by 5.3%, much higher than the growth rates in APAC.
This growing wealth requires proper handling and more sophisticated wealth management platforms. And as more domestic and foreign players flood the space to cater to these growing demands, wealthtech companies are exploring and targeting different use-cases to serve specific customer needs and stand out from the crowd.
B2B2C wealthtech providers (Expersoft)
This includes platforms that offer comprehensive and holistic wealth management solutions for traditional players. Expersoft, for example, provides a whole suite of wealth management products to banks, independent asset managers, family offices and institutional investors. Headquartered in Switzerland, the company operates across APAC and Europe, with Singapore and Hong Kong being some of its main markets.
Expersoft’s integrated PM1 product family covers solutions for portfolio management, client relationship and order management, investment advisory, analytics and reporting, as well as client engagement. These solutions not only automate tedious tasks but also provide valuable data and insights to help asset managers optimise gains. For instance, Expersoft’s portfolio management solution provides a consolidated view of total wealth with over 600 risks and performance figures and data that are delivered in near real-time and on a configurable dashboard.
Moreover, Expersoft’s reporting and analytics engine analyses data from multiple sources i.e., multi custodians, and helps financial service providers generate, export, and publish standard and customisable client reports. Expersoft’s investment advisory feature offers tailored investment solutions based on client goals, objectives and risk appetite. The best possible investment option can be selected by asset managers after evaluating portfolio simulations against standard and custom risk scenarios.
The company’s client relationship management solution is geared towards helping financial service providers cover all key regulatory and due diligence requirements. On the other end of the spectrum, to cater to the increasing demand from clients for more data and visibility over their assets, Expersoft offers a comprehensive client portal. Using this portal, clients can track their assets and their performance, view cashflow projections, analyse their position, and more.
Most importantly, Expersoft’s order management system introduces efficiency by capturing single and bulk orders for securities, payments, forex, derivatives, etc. It also offers wealth management providers granular control over the entire process with pre-trade checks.
Pascal Lemann, Expersoft Systems’ regional manager for APAC explained,
“For example, if you want to order an equity in another currency than the reference currency in the portfolio, then there is a soft restriction. You get informed about it and you just have to comment, verify and justify it in order to have the audit track, which is important for auditing and for the MAS [Monetary Authority of Singapore] or other regulatory authorities. However, trying to order a bond into an Equity portfolio triggers a hard restriction and is just not possible.”
Ultimately, Expersoft’s wealthtech solution provides a 360-degree view and control of the process to wealth managers as well as clients. And with sophisticated and intelligent systems that allow granular level customisation, client requirements and objectives can be easily be optimised. Singapore-based AGDelta and Tradesocio, which got acquired by Bambu, and 360F are other notable players in this segment.
Wealthtech focusing on robo-advisory (StashAway )
The demand for robo-advisory services that offer automated data-based investment advice has been growing steadily across the world. The global robo-advisory market size was worth US$4.51 billion in 2019 and is estimated to grow at a CAGR of 31.8% to US$41.07 billion by 2027. StashAway is a prime example of a robo-advisor based in Singapore that offers cost-efficient and customisable investment plans online.
The StashAway platform analyses customers’ financial situation and objectives and offers personalised investment plans to meet these objectives. For example, StashAway offers goal-specific investment options, like an investment for retirement, creating a steady income flow, increasing wealth, or even buying a house. With flexible standing instructions, customers can stay on track with their investment plans in accordance with the changes in their financial situation.
StashAway claims to use macroeconomic indicators to manage investments, which allows it to adapt to evolving market situations on time and maintain steady gains. Additionally, when certain assets outperform others, the platform also automatically rebalances portfolios to maintain risk levels. StashAway’s risk index allows customers to also choose the level of risk they are willing to expose their assets to.
The startup claims to have brought investment portfolios with sophisticated investment strategies, that were previously only available to institutional investors, within the reach of retail investors. Moreover, it also claims to have lower management fees and expense ratios than traditional investment firms. Besides, the firm also offers a cash management option with projected returns of 1.2% annually and hassle-free withdrawals.
Owing to the rise in digital adoption, StashAway attaches considerable significance to user experience and operates with a mobile-first approach. In fact, more than 50% of the company’s resources are devoted to building the technology and platform to offer a seamless customer experience.
Other notable robo-advisors in Singapore include Bambu, Smartly, AutoWealth, to name a few. However, StashAway’s main competitors remain traditional banks rather than other robo-advisors and investment platforms.
Wealthtech platforms offering investment tools and resources (smartkarma)
These wealthtech platforms are geared towards providing consumers access to investment tools, research and other investment advice. A notable player in this segment of wealthtech in Singapore is Smartkarma, which connects investment insight providers, investors and investor relation professionals. Smartkarma acts as a collaborative cloud-based marketplace for Asian investment research and analysis.
The company claims to allow independent research to be shared in a more “intelligent and efficient” manner than previously possible. It combines insights from analysts, academics, data scientists and industry experts to help investors improve efficiencies, boost returns, and optimize their research spend while accessing a wide range of global analyses of the Asian markets. Through this, Smartkarma aims to solve the problem of overpriced, large-cap-skewed, and biased investment research.
Moreover, the company focuses on investment coverage based on what its network deems as actionable or relevant at any point in time. This ensures that investors have access to insights that add genuine value. The company also facilitates networking between its users and collaborators, so that different perspectives and opinions are available to its users.
Other notable players in this field include Call Levels, which provides real-time financial monitoring and alert services, and WEALTH, an online wealth services marketplace that helps customers find and connect with products and services best suited to their needs.
Wealthtech focused on digital asset management (Sygnum)
Digital assets like cryptocurrencies have gained immense popularity since last year. Several institutional players have announced investment and entry into digital assets space to capture the immense potential for growth in this sector. These include Goldman Sachs and DBS, which introduced a bank-backed crypto trust service and a digital exchange. A notable fintech player in this category of wealthtech in Singapore is Sygnum.
Based in Switzerland and Singapore, Sygnum has a Swiss banking license and a Singapore asset management licence. The company uses distributed ledger technology (DLT), a decentralised database, to embed digital assets into regulated banking. Its customer base includes institutional and private qualified investors, corporates, banks and other financial institutions. Since digital assets are largely unregulated, by bringing digital assets under the purview of regulators, Sygnym encourages trust among investors as they explore the digital asset economy.
The company allows its customers to trade and store digital assets, create new tokens and avail loans against digital assets. Moreover, Sygnum also provides digital asset investment products, and a B2B banking service that allows institutional players to provide regulated digital asset products and services to their customers.
While these examples show the diverse use-cases of wealthtech in Singapore, the list is not exhaustive. As more and more players crowd the market, wealthtech players in Singapore continue to introduce new and innovative use-cases to carve out attractive and profitable niches.
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