The Covid-19 pandemic has accelerated the digital migration of businesses and industries around the world. The investment industry wasn’t spared, and asset managers and financial advisors had to quickly adapt to electronic meetings, paperless processes and new ways of serving clients.
Georgina Smith, head of Distribution and Client Services at independent investment platform INN8, says although some businesses were in the process of migrating to digital and paperless processes, many were forced to accelerate their adoption of digital solutions virtually overnight.
“Many financial advisors panicked when Covid-19 regulations banned face-to-face meetings,” she says. “Advisors still needed to work and serve their clients. Clients still needed to access investment products, and asset managers still needed continued capital inflow. Unfortunately, particularly in the offshore space, this was largely a paper form and signature-based industry which posed a problem for most advisors.”
The pandemic required financial services to adopt digital solutions for many traditional paper-based administrative processes.
“At INN8 we really saw the pandemic as a time to benefit and seized the opportunity to exponentially grow our platform using our digital, straight through, signatureless offshore investing processes,” Smith says.
Smith adds that advisors have always looked to their administration suppliers to either help them improve their client value proposition or to help them remove costs from their business. The pandemic forced suppliers to accelerate any digitising plans they had.
“For instance, administrators had to problem solve changing the way they sought proof from advisors that they had verified their clients’ identity and obtained approval to execute investment decisions.”
Smith points out that in the not-too-distant past a client’s identity could only be verified with a signature.
She adds that “today, there are several solutions on offer to advisors ranging from simply accepting digital signatures to the INN8 way which is changing the role of the administrator from policeman to a trusted partner”.
“This involves aligning to the advisor’s own compliance process to ensure client consent is obtained. This in turn removes the need for forms and both enhances the advisor’s client value proposition and removes cost from their business.
“The financial and investment industry has been slow to adapt to the new digital world in certain aspects.
“But being forced to look at digital solutions has greatly increased efficiencies. Digital processes inherent in a digital investment platform free up time and make administration easier for clients, advisors and asset management companies.”
Compliance and security
The increased use of digital platforms also simplifies regulatory oversight since an electronic ‘paper trail’ is, in most instances, more secure than traditional paper-based systems.
“Regulators are helpful when it comes to making the investment industry safer and more efficient. Their aim is very much to keep investors safe whilst not overcomplicating the process.”
Smith notes that when INN8 developed its owned digital and paperless platform, it worked closely with regulatory authorities to ensure that it adhered to all regulations to ensure optimal efficiency.
Taking relationships to the next level
The adoption of digital processes has also changed the relationship between financial advisors and their clients.
“In future, even if Covid disappears, many people are likely to adopt a new mix of working remotely and face-to-face,” says Smith.
“Personal relationships between advisors and clients will remain as important as always, but communication will never be the same again.
“Advisors and clients will continue to interact through digital means such as video calls, email and instant messaging services interspersed with face to face meetings. My expectation is that the traditional meetings will remain but the variety of engagement tools will expand to suit different conversations.
“The pandemic has also forced administrators’ client servicing departments to take a good look at themselves,” Smith says. “Interacting with the advisors’ offices only via email and a traditional telephone line is no longer okay. Adopting technology like VOIP [voice over internet protocol] enabling agents to work at home is now a norm. Just like the advisor and their client we are seeing the variety of engagement tools between administrator and advisor increase to include webchats, WhatsApp for business, and robots. It’s about using the appropriate communication tool for the right conversation.”
Investors are the winners in the digital era and will continue to benefit from perpetual technological advancements.
“Costs are bound to decrease and client value propositions will improve. Interactions will become more productive for both clients and advisors, and service levels will improve,” says Smith.
Brought to you by INN8.
Liberty Group Limited is a Registered Long-Term Insurer and an authorised Financial Services Provider (“FSP”) with FSP number 4209 and registered office residing at 1 Ameshoff Street, Braamfontein, Johannesburg, 2001; INN8 is a registered trademark of STANLIB Wealth Management (Pty) Limited, an authorised FSP with licence number 590 and registered office residing at 17 Melrose Boulevard, Melrose Arch, Johannesburg, 2196, South Africa; and a registered business name of STANLIB Fund Managers Jersey Limited, regulated by the Jersey Financial Services Commission with registration number 30487 and registered office residing at Standard Bank House, 47-49 La Motte Street, St Helier, Jersey JE2 4SZ. © 2019 INN8.
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