Rapidly evolving wealth platforms with cost-efficient models, global reach, and advanced analytics are challenging traditional financial firms. This timely blog helps incumbents stay competitive by optimising operations, embracing digital tools, and expanding asset offerings to meet shifting client demands.

Over the past decade, wealth platforms have emerged as a disruptive force in the financial services industry. These digital-first platforms leverage technology to broaden market reach, diversify product offerings, and reduce overhead expenses—often generating more competitive fees and improved user experiences. According to a 2023 BCG study, digital wealth management platforms witnessed a 30% annual growth rate over the previous five years, far outpacing traditional brick-and-mortar advisory practices. In the years ahead, the global digital wealth management market is expected to maintain a double-digit CAGR of 15% to 25%, reaching well over US$10 billion in total revenues by 2028.

For incumbent players—long-standing banks, brokerage firms, and wealth management advisories—the rise of such platforms poses essential questions about market share, profitability, and brand relevance.

Why the popularity?
A confluence of factors has boosted the popularity of digital wealth management platforms. Regulatory technology (RegTech) advancements have eased compliance hurdles, while high internet penetration and smartphone adoption worldwide have broadened the user base. Meanwhile, low-cost computing power and advancements in artificial intelligence have significantly lowered entry barriers, allowing newer platforms to scale quickly and offer sophisticated tools once reserved for high-net-worth clientele.

Essential differentiators of wealth platforms
New entrants in wealth management are not merely offering stripped-down advisory services—they are introducing features designed to enhance the user experience and internal operational efficiency. Below are some of the primary differentiators:

1. Technology-driven decision-making: Modern wealth platforms employ algorithm-based advisory tools, portfolio rebalancing models, and data analytics to deliver real-time insights. This empowers clients to make informed decisions with minimal friction. According to Deloitte’s 2025 Investment Management Outlook, about 60% of surveyed investment management firms use AI in their data-related distribution undertakings to a modest degree. This level of convenience aligns with today’s digital-savvy investor, who appreciates access to sophisticated financial models without the lengthy turnaround times often associated with traditional advisory processes.
    
2. Streamlined Cost Structures: Many wealth platforms have minimal physical infrastructure and a lean workforce, which allows them to lower overhead costs. Thus, they can pass on cost savings to clients by reducing fees—an appealing proposition for investors focused on preserving gains. While well-established institutions maintain branches, compliance teams, and multi-layered operations, digital platforms can pivot quickly, adopting automation to reduce manual tasks and human errors.
    
3. Global online reach: In an interconnected era, investors increasingly seek access to international markets, diverse asset classes, and 24/7 trading opportunities. Wealth platforms can cater to these demands via cloud-based solutions and user-friendly mobile applications. By contrast, incumbents often grapple with legacy systems that limit real-time data synchronisation or cross-border trading capabilities. A 2022 World Bank report found that online brokerage accounts grew by 45% globally between 2019 and 2022, reflecting a heightened appetite for seamless international investing.
    
4. Access to wider asset classes: Wealth platforms often provide broader asset coverage than traditional firms, from cryptocurrencies to alternative investments like private equity and venture capital funds. As per PwC’s 2023 Global Wealth Report, the share of clients interested in digital assets rose to 32%, up from just 12% five years prior. By incorporating these offerings, digital platforms cater to niche investor segments hungry for high-growth or specialised investments—segments that more conventional approaches may underserve.

Why wealth platforms present a revenue threat

• Competitive pricing: Lower fees and transparent cost structures attract price-sensitive or younger investors, steadily eroding incumbents' client base.
• Rapid scalability: Digital platforms can onboard hundreds of new investors in a fraction of the time it takes a traditional firm to conduct manual KYC (Know Your Customer) processes.
• Brand differentiation: By emphasising user experience and digital convenience, platforms cultivate a modern brand image that resonates with next-generation investors, challenging the classic appeal of legacy institutions.

These factors directly impact traditional players' revenue models, often leading to reduced advisory fees and higher client churn. While established firms may hold advantages in trust and long-term relationships, ignoring the digital shift can be costly in a market where growth is increasingly driven by technology adoption.

Incumbents partnering with wealth platforms
Several established financial institutions have formed strategic alliances or made acquisitions to leverage the technology and client reach of digital-first wealth platforms.

• UBS and SigFig: In 2016, UBS partnered with the robo-advisor SigFig to bolster its digital advisory capabilities, signaling a shift toward more tech-enabled client services.
• Wells Fargo and SigFig: Wells Fargo also partnered with SigFig for digital advisory solutions, integrating SigFig’s technology to complement the bank’s traditional advisory offerings.
• JPMorgan and Nutmeg: In 2021, JPMorgan acquired UK-based digital wealth manager Nutmeg, aiming to expand its online investment services and serve a broader, tech-savvy client base.

How incumbents can counter wealth platforms

• Empower investors with enhanced decision-making tools
  Although automated decision-making is a core strength of digital platforms, incumbents can offer blended solutions that integrate cutting-edge analytics with human advisory. Incorporating intuitive dashboards, risk assessment tools, and real-time portfolio tracking meets client expectations and underscores an institution’s dedication to transparency. According to the 2023 EY Global Wealth Research Report, there has been a significant increase in client appetite for virtual advisor interactions since the pandemic. The proportion of clients preferring virtual consultations for investment management jumped from 12% in 2021 to 46% in 2023

  Primary action: Provide digital tools that augment rather than replace personal advisory. This balance leverages human experts' credibility while meeting contemporary investors' speed and convenience demands.

• Optimise cost of operations
  Established firms must streamline internal processes and modernise legacy systems to remain competitive on fees. Moving to cloud-based infrastructure, automating routine tasks like compliance checks, and embracing e-signature solutions for client onboarding can substantially reduce overhead. By trimming back-office expenses, incumbents can afford to lower fees or reinvest in technology upgrades. According to Accenture's research, banks that migrate their workloads to the public cloud can achieve Total Cost of Ownership (TCO) savings of 30-40% within three years.

  Primary action: Ongoing investments in automation and advanced analytics can minimise manual inefficiencies, allowing incumbents to pass cost savings to clients or bolster other service areas.

• Leverage online reach for market expansion
  Digital platforms excel in attracting cross-border investors and younger demographics. Traditional players can replicate this success by broadening their online presence through user-friendly mobile apps, global product offerings, and digital marketing campaigns. Building robust cybersecurity measures and compliance frameworks can help incumbents differentiate themselves on reliability—a crucial factor for high-net-worth or risk-averse individuals.

  Primary action: Prioritise a robust digital footprint but underscore compliance and security to cultivate trust among diversified investor segments.

• Expand into wider asset classes
  While traditional firms often concentrate on mainstream investments (e.g., equities, bonds, mutual funds), they can diversify offerings to include alternative investments—ranging from hedge funds to private equity to ESG-focused portfolios. Leveraging in-house research capabilities and long-standing institutional partnerships, incumbents can deliver curated options that surpass the often less personalised suggestions of purely digital platforms.

  Unsurprisingly, according to Morgan Stanley's 2023 Sustainable Signals survey, 77% of investors reported being interested in sustainable investing, with 40% being "very interested." By integrating these asset classes and emphasising personalised, values-based advisory, incumbents can distinguish themselves from purely algorithmic solutions.

  Primary action: Supplement traditional offerings with emerging and alternative investments backed by reputable research and professional guidance to retain and engage progressive investors.

Seizing the momentum
Wealth platforms have reshaped the competitive landscape in ways that many traditional players initially underestimated. Their technology-driven decision-making reduced operational costs, global online reach, and broader asset classes offer potent advantages that continue to attract novice and experienced investors. However, incumbents possess significant assets, most notably trusted brand equity, deep client relationships, and long-term industry expertise.

By combining technology and human-centered advisory, incumbents can effectively defend against the rising tide of digital disruptors. Cloud adoption, AI-driven analytics, global product expansion, and more diversified asset offerings allow them to remain relevant even as client expectations evolve.