The UK’s wealth management sector remains buoyant and offers opportunities to those prepared to adapt and evolve with it, which increasingly means leveraging technology to grow and thrive. This can be in the context of exceeding client expectations on service delivery and engagement, empowering the adviser in the provision of that service, or underpinning more structural issues, such as being able to reduce the cost to serve through better technology use and thus, come down the wealth value chain to serve an emerging mass affluent investor community or adapt to new regulation.

Within the client section of this report, we look at how clients’ needs can best be met going forward. Engagement remains high on the list of priorities for wealth managers, but one of the challenges that they face is connecting with various client segments on their own terms in a way that captures and keeps their attention.

In the UK, there is plenty to go at. Nowhere is this more pertinent for the UK wealth management community than within the mass affluent sector, either self-made or those that are short to inherit.

Royal London estimates that there are approximately 13.1 million individuals in the mass affluent market in the UK, including 3.7 million who are currently non-advised but are open to receiving financial advice.

The mass affluent story is set only to continue and has been driven by house prices, low debt rates, a low-interest rate environment, and a culture of business starts up. But the economic forecast remains uncertain, and the cost-of-living crisis and inflation are both very real. However, the wealth management sector has a positive overall outlook with long-term structural processes that allow for the sector’s continued growth.

For one, the need to save for retirement has been well documented, and building up investments is currently top of mind for many in their 50s and at the height of their earnings. Pensions reform has also given more freedom to individuals regarding the management of their pension’s assets - notably the ability to transfer assets from a pension’s wrapper into other investments. In addition, automatic pension enrolment has created a greater awareness of pensions and will result in greater levels of asset accumulation going forward.

No doubt, wealth managers in all shapes and forms will be looking to maximise the opportunity the growth of the market affords. One way of doing that is providing a digitised front-end experience that allows a degree of self-service and reduces cost to serve.

That theme is, of course, highly relevant within the adviser section of the report too. We explore topics such as technology support for client-facing teams in terms of efficiency and engagement, the importance of the human touch, as well as the means to deliver on investment goals.

Becoming the trusted adviser
Of course, making it as easy as possible for the adviser to perform well by exceeding service expectations, providing robust and agile whole-of-life investment planning, and a plethora of other services adds up to making the adviser the trusted adviser and life partner. And that equates to success for the adviser and the wealth management firm alike. This becomes interesting from a strategic point of view because there is an upcoming shortage of advisers due to the fact that many are retiring - which will make for a war for talent as firms line up to attract and retain the best advisers and other professionals. The retirement of large numbers of advisers is also contributing to the increase in mergers and acquisitions as firms are sold - and acquired by larger entities to become part of a greater whole.

Indeed, this is one the themes we look at in the business section of this report. Mergers and acquisitions to secure scale are rife, and any newly created entity needs to have in place a strategy to become a cohesive whole. Technology is central to the success of such projects and plays a unifying role. Other structural and strategic uses for technology, such as the relevance of AI, optimising the backend, how to adapt to Consumer Duty and finally, trusting technology all come under the spotlight in this section.

All in all, then, there is a clear opportunity for those able to provide the right blend of products and services to capture and retain wealth. Indeed, the UK is the world's biggest asset management centre outside the US, and is bigger than the next three largest European countries combined, according to Global City. The UK has also created a positive environment for investment on the back of its collaborative and innovative regulator and a plentiful pool of finance professionals.

But being able to identify, describe and action those trends as they emerge, and thus position the business for future success is crucial. That is where this report comes in. By exploring some of the main themes we see in the market, and describing the impact that technology can have on moving those thematic issues into actionable insights and strategy, we aim to capture a snapshot of the UK wealth management community as it stands today. The purpose is to identify the issues and developments that are top of mind for wealth managers, and then seek to explore the ways in which the burgeoning WealthTech community can help to drive wealth managers forward and prepare them for success.

About this report
One of the biggest issues that vendors and wealth managers face is getting to know each other, and that is where this report comes in as part of our overall goal of identifying, profiling and categorising the entire solution provider landscape around the wealth management sector. As with each of the other reports published in our ongoing WTLR series, our goal with the UK WTLR 2023 is to feature content from both wealth managers and vendors. We aim to start a conversation that spans both sides of the community.

While this report is a one-time showcase of this market, our online directory is available 24/7, 365 days a year, as a digital host of solution provider profiles, solution profiles, and content. Whatever your profile, this resource has been built according to the business needs of firms in the UK and the wider wealth management community across the world.

Ultimately, we hope we can help the UK wealth management sector make more informed decisions about technology infrastructure and stay abreast of the market’s status.

If you are a solution provider serving or targeting the UK wealth management sector but not included among the 786 businesses included in this report, please reach out: office@thewealthmosaic.com

Interested in reading the full report? You can read this edition of the UK WealthTech Landscape Report online here.