Future-Proofing Wealth Management: How WMaaS and Next-Gen Technologies are Redefining the Client Experience

In 2024, wealth managers are laser-focused on adding new clients (64%), deepening existing relationships (48%), and enhancing client experiences (46%)—priorities that align with the wealth management market’s projected Assets under Management, expected to reach a staggering $162.3 trillion globally, with financial advisory dominating at $159.5 trillion.

This focus is timely, given the ongoing “Great Wealth Transfer,” which is set to see $72.6 trillion in assets shift from baby boomers to millennials by 2045. Wealth managers must innovate to stay relevant as wealth passes to a new generation with distinct expectations. They must transform their digital offerings to succeed, providing seamless, accessible, customized services beyond investment advice.

Wealth Management as a Service (WMaaS) is reshaping the industry, offering scalable, flexible solutions that cater to these evolving needs. Providers can differentiate themselves and thrive in a competitive landscape by embracing advanced technologies, which can provide a substantial edge in transforming the wealth management space for the future.

16% of existing asset and wealth management firms could be acquired or cease operations by 2027 if they do not adapt to the evolving digital landscape – PwC

According to insights from leading analysts such as Forrester, these nine emerging technologies are positioned to transform and redefine the wealth management industry.

1. Generative AI: Revolutionizing Client Interaction and Personalization

Generative AI is a powerful tool for generating insights, drafting content, and offering automated responses to client queries. It can enable personalized client interactions on an unprecedented scale. Understanding customer preferences and financial habits can create tailored investment recommendations, portfolio management strategies, and timely insights.

This helps wealth managers offer bespoke advice and solutions, enabling a deeper connection with clients and ensuring they receive the individualized care typically reserved for high-net-worth individuals. Gen AI also aids in automating workflows, allowing advisors to focus on strategic decision-making rather than administrative tasks.

2. Cloud-Native Computing: Enabling Scalability and Flexibility

This allows providers to deliver both scalable and highly flexible services, making them adaptable to the ever-changing needs of the financial markets. It allows storage and processing of vast amounts of data, facilitating real-time data analysis, seamless integration, and cost-effective scaling.

This enables faster deployment of new features and continuous updates, keeping the service aligned with the latest technological advancements. Major cloud providers also invest heavily in cybersecurity and data privacy protocols essential for financial institutions, enhancing security and compliance measures.

3. Explainable AI: Building Trust through Transparency

In wealth management, trust is paramount, and AI-driven decisions must be transparent for clients and regulators. Explainable AI (XAI) enables WMaaS providers to open the “black box” of AI algorithms, making their decisions understandable and justifiable. This transparency builds client confidence in AI-based recommendations and ensures compliance with regulatory requirements, which increasingly demand explainability in AI-driven financial services.

With XAI, wealth managers can easily interpret why a particular investment recommendation was made, fostering trust and facilitating more informed decision-making for the advisor and the client.

4. Intelligent Agents: Offering Proactive, Round-the-Clock Assistance

Intelligent AI-powered agents provide WMaaS clients with 24/7 support and proactive insights. Unlike traditional customer service models, intelligent agents can learn from interactions and continuously improve, enabling them to assist clients effectively with a wide range of queries, from portfolio performance to market trends. They can also alert clients to investment opportunities and risks in real time, which is invaluable in a fast-moving market.

5. Automation Fabric: Streamlining Complex Operations

The automation fabric weaves together various automation tools and processes across the organization, enabling seamless and consistent delivery of services. In the WMaaS model, scalability and efficiency are key, and the automation fabric simplifies complex workflows, from onboarding and compliance checks to portfolio rebalancing and reporting.

This integration reduces the risk of errors, speeds up processes, and enhances operational efficiency. By automating routine tasks, providers can focus on high-value activities, ultimately delivering more efficient and cost-effective client services.

6. Machine Learning and Predictive Analytics: Anticipating Client Needs

Machine learning and predictive analytics enable WMaaS providers to move from reactive to proactive client service. By analyzing historical data and identifying patterns, these technologies can predict client behavior, potential life events, and financial needs.

For example, machine learning can identify when a client may be likely to retire, purchase a home, or need liquidity, allowing advisors to offer tailored financial planning proactively. Predictive analytics can also enhance risk management by forecasting market trends and potential economic downturns, enabling providers to advise clients on adjusting portfolios accordingly.

7. Customer Analytics: Understanding and Segmenting the Client Base

Customer analytics goes beyond simply tracking transactions; it delves deep into understanding client demographics, preferences, and behaviors. Providers can use customer analytics to segment clients based on risk tolerance, investment goals, and lifestyle.

Wealth managers can craft more targeted investment strategies by understanding these nuances, improving client satisfaction and retention. Additionally, it helps providers optimize communication, ensuring clients receive relevant insights and offers at the right time, increasing the likelihood of positive engagement.

8. Sustainability Ratings and ESG Analytics: Aligning Investments with Values

Today’s investors, particularly millennials and Gen Z, are increasingly focused on sustainability and ethical investing. ESG (Environmental, Social, and Governance) analytics provide providers with insights into how companies perform regarding environmental responsibility, social impact, and governance standards.

By integrating sustainability ratings and ESG analytics into their offerings, providers can attract clients who want their investments to align with their values. This approach meets demand and positions providers as responsible, forward-thinking entities committed to positive societal impact.

9. Decentralized Digital Identity: Enhancing Privacy and Security

Data privacy and security are critical in wealth management, where sensitive financial information is handled. Decentralized digital identity technology offers clients control over their identity information, reducing reliance on centralized systems vulnerable to breaches. For providers, decentralized digital identity means a streamlined onboarding process, reduced identity theft risk, and compliance with privacy regulations such as GDPR.

It enhances trust and enables secure transactions, making it a cornerstone for client-centric and security-conscious wealth management services.

The Future of Wealth Management: Embracing a Holistic, Tech-Driven Approach

The shift toward WMaaS is transforming wealth management, making it more accessible, flexible, and client-centered than ever. As client expectations evolve, providers must adopt advanced technologies like generative AI, cloud-native computing, explainable AI, and ESG insights to meet demands for personalized, transparent, and sustainable solutions. These innovations create a comprehensive, future-proof approach, enabling providers to improve operational efficiency and deliver exceptional client experiences that build trust and loyalty.

By embracing these technologies, WMaaS providers future-proof their businesses and democratize wealth management, expanding access to sophisticated financial services. This inclusive model aligns with modern investors’ values, combining purpose with profit, and marks the beginning of a transformative era in wealth management.