Digital Wealth

Management
in Asia Pacific
A comparative analysis across eight key markets

2021

kpmg.com/cn
 Foreword
Asia Pacific has been witnessing strong econom ic As a result, a growing num ber of financial institutions
prosperity as a result of its open business have widened their target custom er groups and
environm ent, relaxed regulatory landscape and a increased focus on developing efficient digital
well-developed infrastructure. This has led to a rise in capabilities to cater to m ass m arkets. In relation to
the population of High-Net-Worth Individuals m obile access to financial services, the race is on to
(HNWIs), particularly the younger generation who provide custom ers with the best “bank-in-a-pocket”
dem and technologically advanced and highly service. This race has been joined not just by
custom ised banking and wealth m anagem ent traditional and neobanks, but also by m egatech and
solutions, designed specifically to cater to their telecom m unications com panies with am bitions to
growing investm ent needs. widen their m arket presence throughout Asia Pacific.
The region is hom e to ~15 m illion HNWIs, the This m ove toward digitalisation has further picked up
second-largest concentration in the world after North pace post the COVID-19 pandem ic. According to
Am erica, with an expected growth of 39 percent by KPMG’s 2020 CEO Outlook Survey, 81 percent of
2024, the highest growth forecast globally.1 About CEOs in the Financial Services (FS) sector feel that
half of these people are located in m ainland China COVID-19 has accelerated digitisation of operations
alone. They are looking for highly-personalised and creation of next-generation operating m odels,
advisory solutions from technologically sound while 76 percent feel that it has accelerated the
advisors to help plan their fam ily wealth and creation of new digital business m odels.2
succession. The num ber of affluent clients is also
This report aim s to highlight all opportunities that
growing. They dem and advanced platform s and
Asia Pacific presents for the players operating in the
features to effectively m anage their wealth on their
wealth m anagem ent sector, particularly with respect
own. Moreover, as digitalisation has reduced client
to their digital capabilities. For the leading global
retention costs and im proved access to their capital,
banks, it shows a wide range of prospects to further
clients with sm all investm ent capital, who have
grow their wealth m anagem ent services in this
never been considered highly im portant by wealth
region, be it through strengthening their team s of
m anagers, now collectively form a key potential
advisors, developing sophisticated digital capabilities,
m arket — particularly in m ainland China where the
or even partnering with local paym ents firm s to reach
m iddle-class population represents m ore than half of
the m asses.
the m arket’s online wealth m anagem ent clients.

Simon Gleave Larry Camp b ell Nancy Yeung

Senior Partner, Partner, Head of Partner, Wealth and Personal
Head of Financial Services Financial Services Strategy B anking, and Operations
KPMG Asia Pacific KPMG Asia Pacific KPMG China
[email protected] larry.campbell@ kpmg.com nancy.yeung@ kpmg.com

1 | Digital Wealth Managem ent in Asia Pacific

© 2021 KPMG, a Hong Kong partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. Printed in Hong Kong, China.
 Contents

Page
1. Summary 03
1.1 Overview 04
1.2 Leading players 05
1.3 Markets overview 09
1.4 Recommendations for banks 11
1.5 Industry trends 13
1.6 Digital capabilities 15
1.7 Macroeconomic view 17
1.8 Regulatory environment 19

2. Markets 21
2.1 Singapore 21
2.2 Hong Kong (SAR), China 37
2.3 Mainland China 53
2.4 India 69
2.5 Australia 85
2.6 Malaysia 99
2.7 Indonesia 113
2.8 Vietnam 127

3. Appendix 139
3.1 Methodology 140
3.2 References 141
3.3 KPMG contacts 148

Digital Wealth Managem ent in Asia Pacific | 2

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 Summary

3 | Digital Wealth Managem ent in Asia Pacific

© 2021 KPMG, a Hong Kong partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. Printed in Hong Kong, China.
 Overview
Banks such as DBS, BoC, OCBC and
UOB have used their large scale, existing
client base and local presence to retain
m arket share in wealth m anagem ent and
Traditional private banking, with a wide range of
Asian integrated FS offerings. However, with
banks the growing threat from digital banks,
these incum bents are trying to expand
their digital offerings and channels,
Asia Pacific is emerging as the plugging in investm ents in em erging
FinTechs as well as upgrading in-house
leading destination for wealth capabilities at the sam e tim e.
management and private banking
globally, driven by the growing Large banks, such HSBC, SCB, Citi, JP
Morgan and UBS, have a strong
wealth in the region as well as the
presence in the region, and are attractive
increasing HNWI population and due to their global capabilities, and
its need for financial advice. The Traditional access to international m arkets and
relaxed and pro-investment Foreign products. These banks have now
regulatory environments in banks increased their focus on wealth
m anagem ent and private banking in this
markets such as Singapore and region, drawing m ore resources to
Hong Kong have been attracting a achieve scale, with m ost choosing
large amount of capital from Singapore or Hong Kong as the centre to
around the world. expand to other Asian m arkets.

As a result, m ost of the top traditional Unlike the traditional players, m ost
foreign banks are expanding their FinTechs are focusing on developing
presence in the region, while the specific, targeted offerings. With
traditional Asian banks are working on supportive governm ents, these players
Emerging
strengthening their wealth m anagem ent have been rapidly growing in num ber,
WealthTechs
businesses and hold in these m arkets. (incl. wealth particularly in the paym ents and
platform WealthTech space. However, with a lot
Interestingly, both groups are providers) of their solutions being B2B, m ost of
experiencing growing com petition from
these firm s are em erging as potential
two types of technologically advanced
partners and tech solution providers to
players. One is the em erging WealthTech
the incum bents, instead of pure
firm s that are developing advanced B2B
com petitors.
and B2C digital solutions, while the other
is the Challenger banks — virtual banks With Asian governm ents extending FS
and paym ents firm s (esp. arm s of tech licences to non-FS players, local (Alibaba,
giants) — that have started acquiring FS Tencent) as well global tech giants
licences to capitalise on their wide (Google, Am azon) are also targeting the
custom er base. Challenger region’s FS sector, using paym ents as
banks the gateway. Although these firm s are
(payments yet to establish them selves in the wealth
firms, virtual m anagem ent and private banking space,
banks)
their vast custom er reach (from digital
paym ents adoption) and the support
from their investors puts them in a key
com petitive position in this space.

The study highlights that while Asian

incum bents have strong existing m arket share,
they are quite slow in the adoption of the latest
Overall, there seem s to be an underlying need for digital advancem ents in wealth m anagem ent
a bank that understands the nature of the and private banking. Whereas, the rapidly
financial advice required in the region; offers a growing challenger banks still form a very sm all
com bination of global products, expertise and portion of the m arket, given their targeted
m arket access; and develops and invests in the developm ents and offerings. Foreign banks
latest technological advancem ents and digital need to strengthen their local advisory team s
offerings. that understand the m arket pulse and specific
requirem ents of the large HNWI population.

Digital Wealth Managem ent in Asia Pacific | 4

© 2021 KPMG, a Hong Kong partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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 Leading players
Asian banks raise investments in digital technologies

Apart from DBS, most traditional Asian banks have been slow to embrace digital advancements in
wealth management, although they are now increasing their investments in acquiring digital
capabilities, virtual bank licences, and more FinTech partnerships

Digital *
DBS BoC UOB CMB
cap ab ilities
Overview • Leader in Asia in digital • Entered WM in 2019; • One of the leading banks • One of the top banks in
wealth management digital growth led by in Southeast Asia; mainland China; formed
(WM) and private banking Hong Kong; has sped strong focus on a subsidiary — CMB
(PB ), widest range of up roll out of digital providing digital wealth Wealth Management in
services online; large services post COVID-19 services to HNWI s 2019; plans to build a
tech. spend, aggressive ‘Digital Bank’ in future
innovation strategy
Digital account • Launched virtual WM • Provides this option in • Available in its digital • Nil
opening / account opening (Hong its first virtual bank bank TMRW launched
onboarding Kong) on iWealth app Livi (co-owned) in Hong in Indonesia
Kong
Research and • Its iWealth app provides • Provides customised • Portfolio I nsights tool • Its mobile app provides
insights users with research and news alert and provides users with risk- users with real-time
insights, and price alerts investment market return analysis and market information and
relevant to one’s commentary scenario simulations by chart analysis for
investment portfolio stress-testing portfolios financial products
Portfolio • Hybrid human-robo • Portfolio advice as per • Asset Management • Hybrid human-robo
management solution digiPortfolio, client investment and I nvest app customises solution Machine Gene
and advisory targeted to UHNWIs, risk profile with clients’ portfolio aligned I nvestment; Risk
provides strategic Aqumon; option to to their investment Tolerance Assessment
financial insights rebalance portfolio objectives system analyses risk
appetite to recommend
investment products
Financial • New digital NAV Planner • Nil • Portfolio Tracker tracks • Nil
planning uses B ig Data to give portfolio health
tailored financial advice • Portfolio Explorer
as per life stage and offers real time
financial position evaluation of portfolio
Online trading • B rokerage arm Vickers • Strong online trading • Online trading platform • Provides securities and
allows trading in a large (stock, funds, bonds, for stocks — UTRADE, FX trading option
number of exchanges FX, eIPO); mobile app with price alerts, trading through online banking
across markets (incl. provides stock screener, insights, fundamental
online onboarding) price alerts and technical analysis
Tools for • Rolled out Portfolio • Nil • Nil • Nil
relationship Advisory Enablement
managers (RMs) tool for RMs providing
intelligent insights about
clients’ portfolio
Key internal • Robo-advisory (with • Robo-advisory (with • Robo-advisory (with NZ • Robo-advisory
technologies Hong Kong FinTech Hong Kong partner FinTech FNZ Group) • B ig Data analytics
being used Quantifeed) Magnum) • AI
• B ig Data analytics • Data analytics
• Artificial Intelligence (AI)
Other key • Launched first online • Initiatives for stronger • Launched MyPortfolio, • Provides surplus fund
offerings/ treasury and cash connect in the Greater a digital investment investment service, via
capabilities/ management simulation Bay Area (GBA) — dashboard to provide its e-banking platform
developments tool Treasury Prism Cross-border wallet, integrated overview of • Launched wealth
Remittance Plus, GB A portfolio to HNWIs planning service on the
Service Connect CMB app
Key markets • Leads in Singapore (HQ), • Hong Kong and • Singapore (HQ), growing • Mainland China and
strong in Hong Kong, mainland China - Focus in Southeast Asia, esp. Hong Kong - Focus on
growing in rest of Asia on the GB A Indonesia the GB A

Note(s): *Includes Bank of China and Bank of China (Hong Kong)

5 | Digital Wealth Managem ent in Asia Pacific
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 Foreign banks bring global expertise and build scale

Leading traditional foreign banks are looking to grow their client-facing teams and build scale in
the region, using Singapore and Hong Kong as their wealth hub and bringing their sophisticated
wealth management products and expert advice

Digital
HSBC Citi SCB UBS
cap ab ilities
Overview • Largest foreign bank in • Focus on digital banking • Top European bank in • Largest private bank in
Asia, but lags in wealth clients in Asia; expects Asia; strong focus on PB Asia; early adopter of
management (WM) and 10% growth in wealth and WM; digital strategy digital banking; now
private banking (PB ); business, led by digital accelerated via focus on tech solutions
accelerating digital acceleration post Singapore, Hong Kong for affluent market
upgrades COVID-19
Digital account • Rolled out digital • Provides online account • Provides this option in • Applied for digital
opening / investment account opening option for all its first virtual bank banking and WM in
onboarding opening in Hong Kong in affluent clients (Priority, Mox launched in Hong mainland China (GB A);
October 2020 Gold and Private) Kong; plans to launch aiming for low-cost
next in Singapore growth
Research and • Wealth I nsights Hub • Wealth I nsights for • Embedded features to • Updates on investment
insights for real-time analysis market research reports access research tools, opportunities; research
and insights; Wealth and in-depth articles track portfolio and market insights that
Dashboard for multiple • Reuters Stock performance, analyse impact portfolio (CI O
views to analyse Analytics tool for market movements House View)
portfolio market insights
Portfolio • Wealth Portfolio Plus • Total Wealth Advisor to • DigiAdvisory, MyRM – • UBS Manage, portfolio
management helps track progress, set goals, manage assets new tools for virtual managed by experts
and advisory uses risk and scenario and track performance interaction with RMs; for • UBS Advice combines
analysis, and analytics • Portfolio 3 60° provides market updates with analytics, expert advice
for informed decisions multiple scenario analysis tailored advice to optimise portfolio
Financial • Wealth Planner maps • Financial planning tool • Nil • Long-term strategy
planning wealth goals and Portfolio analyser, advice based on risk
financial health online which integrates and tolerance from expert
• Pinnacle (mainland diversifies risk with CIO advisors
China) for mobile wealth portfolio stress tests
planning
Online trading • Wide-ranged online • eBrokerage to invest in • Online trading across • Online trading in
trading (stock, bonds, securities, monitor price, many exchanges and equities, bonds and
funds, trusts, FX); new track trading movement markets; dedicated FX funds in global markets
low-cost FlexI nvest • eFX provides access to tool for latest price incl. Hong Kong, SG, US
launched in Hong Kong global FX market alerts, FX updates and UK
Tools for • B lackrock’s Aladdin • Live Chat, Hello, • MyRM uses B ig Data to • Direct connect with
relationship Wealth platform with Virtual Remote help RMs advise advisors using Skype,
managers (RMs) enhanced portfolio Engagement tools – live premier clients; incl. WeChat, WhatsApp
analysis, construction chat, audio and video chatting, calling, file and • Increased focus on
capabilities for RMs banking for affluent screen sharing productivity of RMs
Asian clients
Key internal • AI, B ig Data to assess • Robo-advisory • Has partnered with • Data analytics
technologies stocks with long-term FinTechs for AI, robo-
being used returns to build wealth advisory
• Partnered with Bambu
for its robo-advisory
services
Other key • PayMe from HSB C – • To open largest wealth • Launched global • New Innovation hub
offerings/ mobile payment service advisory centre, Citi flagship wealth centre Evolve in Singapore
capabilities/ currently available for Wealth Hub in in Singapore (first in Asia) to create
developments Hong Kong Singapore next generation of digital
• Launched Global Wallet competencies
in 13 Asian markets
Key markets • Hong Kong (largest • Strong in Hong Kong, • Largest market Hong • Singapore and Hong
market), Singapore and Singapore; wealth focus Kong, followed by Kong
mainland China increased in mainland Singapore, mainland
China and India China

Digital Wealth Managem ent in Asia Pacific | 6

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 WealthTechs develop advanced solutions at low costs

Rapidly growing WealthTech players are either developing advanced wealth management
platforms and intuitive advisory solutions for their partnerships with big banks or using their low-
cost structure to directly tap the middle-class population

Digital
WeInvest Lufax Kristal.AI AutoWealth
cap ab ilities
Overview • Founded in 2015, offers • One of mainland China’s • Rapidly growing B2 C • One of the leading WM
end-to-end digital top online wealth WealthTech; offers robo-advisors in
wealth services; focus management (WM) portfolio management Singapore; focus on
on personal-financial platforms, backed by and trading; focus on long-term wealth, uses
advice for affluent Ping An, wide range of mass affluent and passive investing (mainly
investors products across markets; emerging HNWI s in ETFs)
focus on upper middle-
class

Research and • StratWealth offers • Customised content • Nil • Provides historical

insights access to 10+ strategies based on client’s performance of its
from global and regional investment habits, risk investment portfolios
providers preferences and • Questionnaire for risk
• Monthly performance, browsing history assessment
funds transferred and
transactions history

Portfolio • GrowWealth offers • Analyses investors’ • Hybrid robo-advisory • Hybrid robo-advisory

management customisable solution for profiles, risk appetites model; uses advanced assigning each user a
and advisory goal and risk-based (with questionnaires); algorithms and strategic personal advisor; offers
investments; aggregates uses Big Data analysis advice from in-house four portfolio types with
and tracks finances with for fund suggestions experts pre-set asset ratios
TrackWealth

Key internal • Robo-advisory • Strong data analytics and • AI-powered digital • AI-based automated
technologies • Data analytics to machine learning private wealth platform investment platform
being used optimise client portfolios • Several AI bots; smart • Robo-advisory • Robo-advisory
AI allows quick online • B ig Data analytics
account opening

Other key • AdviseWealth for real- • Deploys algorithmic • Portfolio rebalancing • Automated portfolio
offerings/ time analysis to RMs sensors at key stages of suggested on change rebalancing
capabilities/ • Pre-approved automatic investment • Wide variety of WM
developments portfolio rebalancing • Partnered with many products (ETFs, IPO,
• Partnered with many top global wealth private equity, mutual
leading banks in Asia managers such as HSB C funds)
and Saxo B ank

Key markets • Singapore (HQ), with a • Mainland China (HQ), • Singapore (HQ), Hong • Singapore (HQ); plans to
growing presence in expanded to Singapore Kong, growing in India; expand to Malaysia, and
Malaysia, Indonesia, (2018) and Hong Kong plans to expand in Asia then Indonesia
Hong Kong, India and (2020) Pacific
mainland China

7 | Digital Wealth Managem ent in Asia Pacific

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 Challenger banks look to alter the Asian wealth management
landscape
Although currently at a nascent stage within wealth management, payments firms have strong
plans to grow in Asia, using their e-wallets to help the region’s vast middle-class population in
channelising its savings into wealth management investments

*
Digital Ant Group WeChat Pay
Grab Gojek
cap ab ilities (Mǎyǐ jítuán) (Weixin)
Key investors • Alibaba • Tencent • Softbank • Google, Temasek

Overview • World’s highest-valued • Mainland China’s leading • One of Singapore’s top • One of the leading on-
FinTech offering digital wallet, actively digital payments demand multi-service
services beyond e-wallet diversifying into the FS provider, with strong platform and digital
(owns Alipay), including sector, particularly WM presence in Southeast payments provider in
online lending platform Asia Indonesia
and investment fund

Major • Launched its WM • Introduced online WM • Acquired Singapore- • Launched GoI nvestasi,
developments in platform in 2015 — Ant platform in 2014 — based robo-advisory online investing tool,
wealth Fortune, offering tailor- LiCaiTong, offering a app B ento to sell retail built inside the GoPay
management made WM services to wide range of WM WM and Financial wallet section
(WM) and investors products to investors Planning products • Allows customers to buy
private banking • Launched its money
• Launched money market • To rename it as and sell gold, as well as
(PB) market fund in 2013 — fund LingQianTong in GrabI nvest keep track of their
Yu’E Bao, allowing 2018, allowing users to investment returns
customers to invest earn interest from their
cash in their Alipay WeChat Pay balance
accounts into liquid
• Launched cross-border
assets mobile payment
• In 2019, became one of service, allowing
the largest money WeChat Pay Hong Kong
market funds globally users to conduct a RMB
• In 2018, introduced denominated transaction
world’s first blockchain- in mainland China using
based cross-border HK$
remittance network • Launched mainland
• Launched virtual bank China’s first online-only
Ant Bank in Hong Kong; bank WeBank; it
co-owns MYbank, one partnered with Nanyang
of mainland China’s first Technological University
Singapore to set up
digital bank
research centre to
develop digital WM
solutions

Future growth • Transformed into largest • Focus on expanding • Aims to bring WM • Aims to diversify into the
strategy and online WM platform in WM platform into mass products to large middle- FS sector in International
focus areas mainland China, offering market (100M users in class market in markets, starting with
access to third party 2018, doubled in 2019) Southeast Asia Singapore and Thailand
WMs • Aims to provide • Cash management and • Plans to spin out its
• Focus on vast middle- inclusive finance through portfolio-based financial financial services arm,
class segment in its digital banks solutions are expected GoFinance, into an
mainland China and Asia • Plans to tie up with • Focus on making it independent entity
(6 00M+ users since BlackRock to make its accessible by adopting a Digital Katalis to lay
launch) tools for investment low-cost model, with foundation for its digital
banking goals
• With digital bank licence, portfolios available to the full fee disclosure
now aims to provide mainland Chinese
integrated banking market
services to its users

Key markets • Mainland China and • Mainland China and • Start with Singapore, • Start with Indonesia,
Hong Kong, now Hong Kong (to launch focus on rolling out to focus on expanding into
Singapore (looking for blockchain-based digital Southeast Asia other Southeast Asian
virtual bank licence) bank Fusion bank), markets
expanding to Singapore

Note(s): *Formerly known as Ant Financial and Alipay

Digital Wealth Managem ent in Asia Pacific | 8

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 Markets
overview
There is a clear gap in Asia for a powerful,
compelling, sophisticated-yet-easy-to-use
digital wealth management offering aimed
at the region’s emerging and growing
wealthy. In individual domestic markets,
some local banks put in a good showing, as
to a handful of WealthTechs. In the region
as a whole, only a couple of universal banks
appear to have the product shelf and
economic clout to truly dominate.

— Larry Camp b ell, Partner,

Head of Financial Services Strategy, KPMG Asia Pacific

9 | Digital Wealth Managem ent in Asia Pacific

© 2021 KPMG, a Hong Kong partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. Printed in Hong Kong, China.
 Singapore, Hong Kong most well-developed for wealth management

Singapore and Hong Kong are the most supportive and developed markets for wealth
management in Asia, however, there are significant growth opportunities in the rapidly growing
affluent and middle-class populations of mainland China and India

Comparing digital wealth management (WM) and private banking (PB) in

the eight Asian markets

• Strong growth in relatively small UHNWI population; and in trusts, family offices
• Rising wave of tech-savvy consumers embracing digital banking solutions
• Top WM and PB hub in Asia and best location for offshore WM; threat to mainland China,
Singapore Hong Kong; witnessing a shift towards onshore WM
• Government support – one of the strongest in the region
• Most top banks actively collaborating with FinTechs
• Highest range of digital PB and WM services; also, with the most advanced features

• Top-class IT infrastructure, but small HNWI market and low mobile banking adoption
Hong Kong • Rapid WealthTech growth; high offshore WM demand
• Good government support (virtual banking, cross-border collaborations, new payment
(SAR) China mechanisms)
• Strong presence of foreign banks, esp. in WM and PB

• Largest market with highest mobile banking adoption (78%)3 and growing upper middle-class

Mainland • Growth in WM platforms and rapid tech adoption by traditional players; high demand for
robo-advisory
China • Moderate government support, with initiatives such as WealthConnect and online-only banks
• Domestic banks dominate, but economy opening up

• Second-largest market with big mass affluent segment4, but slow internet penetration
• Rapid growth in UHNWIs, though limited tech adoption and favour advisory WM style
India •
•
Govt. promoting digital financial services, but limited support in WM
Traditional banks lead WM and PB segment, though FinTechs booming
• Demand mainly for cost efficient WM products and advisory services

• Large millionaire population, but slow adoption of digital banking and WM services

Australia •
•
Untapped, less-satisfied HNWI market; potential for digital WM advice to grow
Rising demand for efficient robo-advisory WM services
• New rules make B ig4 banks divest WM and bolster PB

• Small but rapidly growing HNWIs; low demand for financial advice due to conservative investors
• Strong internet penetration; leader in e-wallet use in Southeast Asia; strong Islamic finance segment
Malaysia •
•
Rising technology spend; focus on strengthening cross-border capabilities
Rising preference for digital banking
• Government stimulating digitisation in banking and capital markets; although strict requirements a
hindrance

• Growing UHNWIs, but prefer liquid assets

• Attractive destination for onshore wealth businesses
Large unbanked population but growing digital wallet adoption
Indonesia
•
• Growing preference for Shariah Financial Services among mass affluent segment
• Government promoting FinTechs, with strong focus on governance and consumer protection
• Foreign players much ahead of local banks in terms of digital wealth capabilities

• Rapid growth in mobile payments; one of the fastest rise in UHNWIs in Asia, however, preference
for basic investment products
• B anks focus more on retail banking, with WM and PB in nascent stage, although slowly gaining
Vietnam momentum with some tech collaborations
• Government promoting FinTechs and non-cash payments, but lags behind in stimulating capital
markets activity

Note(s): The eight markets have been ranked on how evolved the wealth management and private banking space is in each market. These rankings are
only indicative and have been based on several factors including digital advancements, regulatory environment, macro-economic view and key consumer
trends. Further explanation of these rankings is provided on page 140
Digital Wealth Managem ent in Asia Pacific | 10
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 Recommendations for banks to
gain competitive edge in the market
Banks must offer more digital, personalised products
To tackle the intense competition in the Asian wealth management market,
banks must increase their online offerings, partner with more FinTechs for
advanced solutions, strengthen the digital capabilities of their advisors and
probably form their own virtual banks

Key insights and recommendations

Develop a sm oother and quicker digital onb oarding m echanism for wealth
m anagem ent and private banking clients; use AI (e.g., Lufax) to enable quicker
account opening
Offer a com bined view and more seamless integrated access to banking,
trading and wealth portfolio (e.g., DBS), with all these available together on the
different digital channels of the bank (apps, websites)
Consider setting up own virtual b anks, (e.g., SCB, BoCHK), to com pete with
other upcom ing virtual banks on lower fees and interest rates
In light of COVID-19, facilitate enhanced virtual interactions of relationship
m anagers (RMs) with clients:
• Leveraging live video calling, screen sharing, docum ent sharing, & trainings
for RMs to conduct one-on-one sessions and group-wide webinars
Make latest market insights & advisory tools available to RMs to help
deliver m ore im pactful advice to clients, like data visualisation tools, intuitive
dashboards, live data processing, voice-to-text technologies & storytelling tools
Develop or onb oard new digital p roducts that align with the dem ands of
current and future clients, taking into consideration their changing investm ent
strategies and risk appetites
More p artnership s with and investments in upcom ing FinTechs and
WealthTechs in the region to leverage their advanced solutions for internal
operations as well as client offerings
Enhance existing range and quality of alerts being shared with clients, from
basic price and stock alerts to m ore detailed insights and recom m endations on
a regular basis
Augm ent current level of access offered in trading — to include securities in
different currencies across more exchanges in a higher num ber of m arkets
Customise p rop ositions and digital channels to cater to the needs and
expectations of the younger client generations, who are m ore tech-savvy and
prefer self-service investm ent platform s

11 | Digital Wealth Managem ent in Asia Pacific Digital Wealth Managem ent in Asia Pacific | 11
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limited by guarantee. All rights reserved. Printed in Hong Kong, China.
 A need to grow advisory teams and develop low-cost solutions

Banks should strengthen their advisory teams and use their presence in Hong Kong to tap the
growing HNWIs in the rest of the GBA, as well as develop low-cost and efficient solutions for the
growing middle-class in mainland China and India

Opportunities and recommendations for digital wealth management (WM)

and private banking (PB) players in these markets

• Hire private bankers, bolster teams focusing on trusts and family office clients
Partner with top B 2B digital WM providers for efficient, low-cost automated processes
Singapore •
• Strengthen digital trading and portfolio recommendations
• Invest more in B ig Data for tailored, predictive solutions

• Use WealthConnect to grow market-share in the GB A

• Invest more in AI and B ig Data analytics to develop tailored forecasting, risk and investment
Hong Kong models
• Expand trading to other international stock markets
(SAR) China • Leverage robo-advisory solutions to offer personalised financial advice
• Customise digital channels to cater to the needs of the younger generation of clients

• Focus on efficient WM products for rising upper middle-class market

Mainland • Use AI and data-driven technologies internally at large scale for efficiencies
• Offer wider range of WM and PB services online with accelerated digital adoption post
China COVID-19
• Collaborate with emerging FinTechs in the wealth space

• Grow presence in digital WM; focus on developing robo-advisory and efficient solutions for
mass affluent clients
India • Strengthen WM advisory team to offer high quality customised advice to UHNWIs
• Develop and launch their own dedicated WM platforms
• Increase investment in AI and B ig Data analytics to develop efficient solutions

• Major opportunity to capture market share as B ig4 banks withdraw from WM businesses
• Grow robo-advisory offerings to meet rising demand
Australia • Partner with FinTech firms to develop new solutions or launch own digital products and services
targeting HNW clients
• Focus on bolstering technical capabilities to support wealth managers

• Partner with e-wallets and FinTechs to enhance cross-border remittance capabilities and user
experience

Malaysia • Educate HNWIs about the benefits of investment in different WM products

• Combine digital and human capabilities to offer personalised solutions
• Invest in strengthening digital wealth capabilities using data-driven technologies

• Focus on educating investors on long-term WM

• B uild hybrid robo-advisory service to offer personalised financial advice to UHNWIs
Indonesia •
•
Invest in advanced data-driven technologies to enhance client experience
Collaborate with digital wallets for wider reach
• Strengthen digital trading and expand across international stock markets

• Educate HNWIs about varied WM products

• Offer more personalised advice and new digital products to enjoy early mover advantage
Vietnam • Launch digital platforms that allow users to invest and park their excess money kept in digital
wallets into liquid assets
• Promote brand image and well-secured banking environment to win customer confidence

Note(s): The eight markets have been ranked on how evolved wealth m anagement and private banking space is in each market. These rankings are only
indicative and have been based on several factors including digital advancements, regulatory environment, m acro-economic view and key consumer
trends. Further explanation of these rankings is provided in page 140

Digital Wealth Managem ent in Asia Pacific | 12

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 Industry
trends
Key trends in the region that influence
the wealth management and private
banking landscape

Focus on technologies offering efficient Growing demand for succession

solutions to mass affluent clients planning in Asian HNWI families

Technologies that offer cost-effective solutions are As HNW business fam ilies in Asia are quite young
becom ing increasingly popular am ong the m ass (led by first/second generation), succession planning
affluent section of Asian m arkets, as shown by the will becom e increasingly im portant as these fam ilies
growth in robo-advisors which are cheaper, grow.
accessible round-the-clock, and offer m ore efficient
Although its existing dem and is low (a 2019 survey
advice than a traditional financial advisor.
reported only 40 percent of Asian HNWIs were
• This has led to m any affluent investors, particularly planning for succession), relationship m anagers have
those with m edium -sized portfolios, taking reported an all-tim e high for succession planning
advantage of this new operating m odel. requests.5 Moreover, COVID-19 has served as a key
trigger event for Asian fam ilies to act on their wealth
Banks should focus on strengthening such offerings,
transfer plans.
particularly in m arkets such as m ainland China and
India, that have a rapidly growing upper-m iddle class Banks should try to augm ent their succession
population. planning services to these HNWIs by:

Key markets • Offering personalised advice (e.g., experienced

advisors building trust with older fam ily m em bers
Mainland China as well as groom ing their younger generation)
• Bolstering online offerings (e.g., Kotak’s Sm art
India Will tool helps clients prepare a will for seam less
wealth transfer to their heirs)

Key markets

Mainland China India

Singapore Hong Kong (SAR), China

13 | Digital Wealth Managem ent in Asia Pacific

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 Universal banks need the vision and will to invest in AI
and Big Data, step up the pace of digital transformation,
and be open to strategic partnerships. Those that are
prepared to also pay top dollar for empathetic, informed
and broad-minded relationship managers whose
connectivity with customer needs and challenges can be
bolstered by technology can provide clients with a
wealth management experience that truly delights.

— Larry Camp b ell, Partner,

Head of Financial Services Strategy, KPMG Asia Pacific

Accelerated digital adoption post Benefit from growth in family

COVID-19 offices

COVID-19 has pushed m any wealth m anagem ent Banks should try to strengthen their position in
clients to online channels for rem ote interaction, sophisticated m arkets such as Singapore and Hong
particularly in the m ass affluent segm ent (younger Kong, to benefit from the growth in the wealth of
tech savvy clients), several banks in Asia have started fam ily offices in these regions.
providing their com plete range of services rem otely.
One way would be to look for m ore partnerships and
Other banks should also try to increase the range of acquisitions in WealthTech firm s and use their
their online banking and wealth m anagem ent advanced solutions to attract m ore private fam ily
services. They should look to evolve from basic investm ents.
offerings, such as portfolio m anagem ent and
• E.g., Credit Suisse acquired a 10% stake in
statem ent viewing, to m ore advanced features, such
WealthTech firm Canopy and integrated its
as portfolio recom m endation, trading, robo-advisory
autom ated solution for fam ily offices, providing a
and virtual interactions.
consolidated view of assets, onto its digital private
Banks should also train their client-facing advisors on banking platform in Singapore and Hong Kong.6
virtual advisory skills, both one-on-one sessions with
Another would be to bolster the team s focusing on
clients as well as broad-based webinars.
fam ily office clients and hire m ore client-facing private
bankers.
Key markets
Key markets
Mainland China
Singapore
Singapore
Hong Kong (SAR), China

Digital Wealth Managem ent in Asia Pacific | 14

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 Digital capabilities
Comparison of digital capabilities of leading wealth management and
private banking players
Scale: Com parative view of digital
capabilities across eight markets
Low High

Hong Kong (SAR),

Category Digital capabilities / offerings Singapore Mainland China I ndia
China
Portfolio statements view 100% 100% 73 % 100%
Access to investment research and
82% 70% 6 4% 80%
insights
Portfolio management 100% 90% 55% 70%
Customer
features Portfolio recommendation based on
55% 6 0% 55% 50%
risk appetite
Digital account opening 91% 100% 55% 70%
Financial planning, analysis, goal and
91% 20% 55% 50%
investment tracking
FX trading 6 4% 6 0% 55% 3 0%
Equity trading 73 % 70% 27% 100%
Digital Fixed Income trading 36% 3 0% 27% 70%
execution Structured Products booking 18% 20% 18% 10%
Funds (ETF) trading 55% 6 0% 6 4% 100%
IPO subscription 50% 27% 40%
Robo-advisory 6 4% 70% 45% 20%
I nternal B ig data analytics 36% 3 0% 9% 3 0%
solutions
Digital offering to facilitate client
91% 50% 55% 50%
interactions

Category Digital capabilities / offerings Australia Malaysia I ndonesia Vietnam

Portfolio statements view 89% 90% 86 % 50%
Access to investment research and
6 7% 70% 43 % 17%
insights
Portfolio management 56 % 90% 71% 17%
Customer
features Portfolio recommendation based on
44% 40% 14%
risk appetite
Digital account opening 89% 90% 57% 17%
Financial planning, analysis, goal
33% 80% 43 % 17%
and investment tracking
FX trading 29%
Equity trading 56 % 50% 17%
Digital Fixed Income trading 11% 20% 14% 17%
execution Structured Products booking
Funds (ETF) trading 56 % 40% 43 % 17%
IPO subscription 11% 20% 14%
Robo-advisory 44% 3 0% 14% 17%
I nternal B ig data analytics 40%
solutions
Digital offering to facilitate client
22% 6 0% 29% 17%
interactions
The percentages are calculated based on the total num ber of banks considered in each m arket (Singapore: 11; Hong
Kong (SAR), China: 10; Mainland China: 11; India: 10; Australia: 9; Malaysia: 10; Indonesia: 7; Vietnam : 5). Cells with no
value represent that no bank offers that digital capability based on our research
Source: KPMG analysis based on data from company websites and annual reports

15 | Digital Wealth Managem ent in Asia Pacific

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 Major trends in digital capabilities of wealth management and private
banking players

Advanced client-facing features Increased focus on leveraging

from WealthTech firms Big Data analytics

WealthTech players are pushing the boundaries in With growing success in retail banking, investm ents
wealth m anagem ent across m ost m arkets with their in Big Data analytics are now witnessing a rise in the
advanced client-facing capabilities, such as intuitive wealth m anagem ent and private banking segm ent.
and comp rehensive dashb oards and intelligent
Banks are looking to gain from the benefits offered by
p ortfolio recommendations, which are available to
these analytics, including:
both, investors as well as financial institutions.
• understanding client diversity and events that
Another key aspect has been their developm ent and drive revenue and loyalty
strong ap p lication of internal solutions, such as • getting insights on client b ehaviour, financial
data analytics and robo-advisor platform s. attitude and investm ent m otivation
• using paym ents and spending data to p redict
Partnering with som e of the leading and em erging
investment p atterns
WealthTech platform s in each m arket can be highly
• as well as data mining for p rosp ecting new
beneficial for banks, as such features will help their clients
advisors increase conversion rates, client
engagem ent and the overall Assets Under As big banks are in a strong position to leverage their
Managem ent (AUM) existing data, they should look to increase
investm ents in developing (or acquiring) such
Key markets advanced analytics capabilities, especially in large as
well as sophisticated m arkets in Asia, that help in
Mainland China Australia Singapore generating useful client insights to offer targeted
financial products.

Key markets

Mainland China Singapore India

Banks strengthen digital tools, Banks look to integrate trading

capabilities of relationship services into their online
managers platforms

As digitalisation has given clients access to a large Given their wider product offerings vis-à-vis wealth
am ount of data, it has becom e im portant for banks to m anagers, m ost leading banks across Asia offer
em power their relationship m anagers with advanced trading services to their clients on their online
tools and capabilities to offer quick, tailored and platform s and apps.
intelligent advice.
These include investing in securities and funds,
There are several features being offered by FinTechs m onitoring stock prices and providing real-tim e
targeted to support financial advisors that banks can quotes and research insights. Moreover, stock
look to develop or acquire. These include: analysis tools help analyse m arket m ovem ents and
• better data visualisation tools, and easy to use identify m arket entry or exit points.
dashb oards Although m any banks in Asia provide a range of such
• processing live and historical data to get talking services, they can further exp and their reach using
points for client m eetings their strong presence and cross-border connects
• storytelling tools for better and effective video across Asia.
interactions
• voice-to-text technologies to speed up post- Also, the trading-related news alerts (tailored as per
discussion call notes portfolio), can be im proved to m atch players such as
• AI, machine learning and analytics to help boost DBS, which provides detailed market analyses and
recom m endations com m entaries as alerts.
These help the advisors m ake a stronger case for
their investm ent ideas. Key markets

Hong Kong (SAR), China Singapore

Key markets

All m arkets, with a focus on UHNWIs

Digital Wealth Managem ent in Asia Pacific | 16
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 Macroeconomic view
Key macroeconomic statistics on digitalisation in wealth management
and private banking space
Scale: Com parative view of digital
capabilities across eight markets
Low High

Hong Kong (SAR),

Key metrics Singap ore Mainland China India
China
Internet penetration (%) 88% 91% 59% 50%
Internet users (m illion) 5.1 6.8 854.5 687.6
Growth (%) +5.3% -0.03% +3.1% +23.0%
Mobile connections (m illion) 8.6 13.6 1,610.0 1,060.0
Growth (%) +1.7% +2.8% +4.3% -1.4%
Adoption of m obile banking in
41% 30% 78% -
2018 * (%)
Transaction value in digital
15.4 14.5 2,309.0 74.0
paym ents (US$ billion)
Growth (%) +24.0% +17.0% +32.8% +34.3%
Total HNW population (m illion) 0.3 0.6 7.3 0.3
Growth (%) +4.9% +9.7% +8.6% +5.4%
Total UHNW population 3,306 2,737 61,587 5,986
Growth (%) +9.5% -8.5% +14.7% +0.2%
Grab WeChatPay Alipay Paytm
Preferred digital wallets
Paylah (DBS) Alipay WeChatPay Google Pay

Key metrics Australia Malaysia Indonesia Vietnam

Internet penetration (%) 88% 83% 64% 70%
Internet users (m illion) 22.3 26.7 175.4 68.2
Growth (%) +1.2% +3.6% +17.0% +10.0%
Mobile connections (m illion) 32.9 40.7 338.2 145.8
Growth (%) +1.3% +0.4% +4.6% +1.9%
Adoption of m obile banking in
43% 41% - -
2018 * (%)
Transaction value in digital
53.8 12.3 35.7 8.6
paym ents (US$ billion)
Growth (%) +16.3% +21.7% +27.6% +19.3%
Total HNW population (m illion) 1.5 0.02 0.02 0.03
Growth (%) +7.4% +6.6% +1.5% +11.8%
Total UHNW population 3,796 675 675 458
Growth (%) +5.2% +2.1% -1.60% +7.3%
Apple Pay Grab GoPay Payoo
Preferred digital wallets
Google Pay Touch n Go OVO MoMo
Note(s): *Data used for adoption of m obile banking is for 2018 for each market (in order to m aintain consistency)

17 | Digital Wealth Managem ent in Asia Pacific

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 Key macroeconomic trends on digital adoption in wealth management
and private banking space
New opportunities from
Low satisfaction levels from growing middle-class and
current financial advice mobile banking adoption

According to a recent study, the wealthiest 30 High rates of internet penetration in Asia have led to
percent Australians were less satisfied with their an increase in the adoption of online and m obile
banking relationships vis-à-vis the bottom 30 percent, services, such as e-wallets and m obile paym ents.
and this gap has widened during 2013–18, reflecting This has m ade wealth m anagem ent products
the unm et advice needs of HNWIs.7 accessible to the large and growing m iddle-class
population in the region at lower costs.
Sim ilarly, a 2019 KPMG report revealed that digital
offerings of wealth m anagers in Hong Kong do not Banks having strong presence am ong the HNWIs
m eet client expectations, owing to limited online should now increase their focus on the untapped
services and lack of customisation and self-service investm ent opportunities in these m ass m arkets.
functionality.8 While HNWIs in Singapore want real- They can learn from the strategies of certain
time analysis and reporting on their portfolio as well upcom ing paym ents firm s (probably even look for
as automatic p ortfolio re-b alancing in response to partnerships) and offer short-term liquid
m arket events. investment options, such as m oney m arket funds, to
channelise the currently idle wealth of this population.
This is a m ajor opportunity for banks as they can
benefit from the unm et dem ands in these m arkets by Also, since these clients are fee-sensitive, banks
developing such digital offerings as well as should develop efficient solutions, such as robo-
encouraging their advisors to strengthen their advisory, that offer personalised services to them at a
relationships with clients. lower cost.

Key markets Key markets

Australia Hong Kong (SAR), China Singapore Mainland China India Indonesia

Growing UHNW population

creating demand for Strong hold of tech players in
personalised solutions e-wallets/ mobile payments

Asia’s UHNW population is expected to increase In m arkets such as m ainland China and Hong Kong,
significantly over the next five years, thereby creating technology giants dom inate the online and m obile
dem and for m ore sophisticated and p ersonalised paym ents system , sidelining the banks from this
wealth management advisory services. interm ediary role. Also, there are several e-wallets
and paym ent platform s em erging in other m arkets.
Since these clients prefer a m ix of both digital and
personal engagem ent to m eet their advisory needs, Like m ost traditional banks in Asia, large foreign
banks should focus on strengthening the digital banks should aim to collab orate with all leading
cap ab ilities of their RMs along with investm ent in digital paym ent platform s (from m ajor players such as
advanced technologies. Alipay or Apple Pay to sm aller upcom ing players) to
cover the m axim um population.
They should build predictive m odels that forecast
future investm ent growth and provide real-tim e Sim ultaneously, banks should aim to expand their
analysis for investm ents tailored to clients’ goals. own paym ent interfaces, such as HSBC’s PayMe in
They should also focus on boosting their virtual Hong Kong and Sim plyPay in India, to m ore m arkets
advisory proposition as the pace of digitisation in within Asia as well as the private banking and wealth
private wealth m anagem ent has accelerated during m anagem ent segm ents.
the COVID-19 pandem ic.
Key markets
Key markets
Mainland China Hong Kong (SAR), China India
Mainland China India Indonesia

Digital Wealth Managem ent in Asia Pacific | 18

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 Regulatory environment
Regulatory developments that support digital wealth management and
private banking
Regulations Hong Kong (SAR),
Singap ore Mainland China India
related to China
FinTechs • New Act supporting • Introduced FinTech • Tightened regulations • Regulatory sandbox for
payment FinTechs Supervisory Sandbox 2.0 on FinTechs FinTechs; New
• Sandbox Express for department to focus on
FinTech innovations FinTech
Digital • Issued nine virtual • Issued eight virtual bank • Step towards digital- • Guidelines for inter-
banking banking licences (2020) licences (2019) only banking licences operability of e-wallets
• Allowing existing banks • Expanded adoption of • New online lending • Ombudsman Scheme
to launch digital banks Faster Payment System rules for digital transactions
Open • More market-driven • Phase I and II launched • Market-driven and in • Managed by non-
banking • Asia Pacific leader in in 2019; next update in its infant stage banking financial
open banking readiness 2020 company – account
aggregators
Cross-border • Proposed exemptions • Expanded market • New forex rules to • Relief for cross-border
services and to foreign firms to offer connectivity with ease cross-border payments
payments cross-border services mainland China transactions
• Developed settlement • Wealth Management
mechanism for FX Connect programme
transactions
Cyber-security • New mandatory cyber • Enhanced cyber • Cybersecurity and • No dedicated cyber-
resilience requirements resilience personal data security law, comes
protection under IT Act
Other • Relaxed rules for robo- • Relaxed taxation system • New asset • New guidelines for
initiatives advisors • Unregulated trustee management rules digital KYC
• Launched guidelines for services • Outbound investments • Introduced Investment
fund managers Advisors Regulations

Regulations
Australia Malaysia Indonesia Vietnam
related to
FinTechs • New rules to allow • Increased collaboration • Increased collaboration • Plan to launch
start-ups to conduct with regulatory bodies with regulatory bodies regulatory sandbox for
banking business • Implemented digital • Implemented digital FinTechs
• Enhanced its Reg. financial innovation rules financial innovation • Dedicated team to
Sandbox benefits rules promote FinTechs
Digital • Several neobanks • Licensing framework for • Allowing commercial • Measures to bolster
banking currently operating digital banks banks to provide digital non-cash payments
• APRA proposed digital • Started digital investment banking services
wallet regulations management framework
Open • Government-driven • Encouraging banks to • Standardised • Working on a draft
banking • Rolled out open banking adopt standards of open implementation of circular for application of
in 2020 application programming open banking by 2025 open APIs
Interfaces (APIs)
Cross-border • Working with NZ and • B uilding up cross-border • Entering cooperation • Certain restrictions on
services and South Pacific banks to payments infrastructure agreements with investing outside
payments reduce cross-border different markets in Vietnam
payment costs Asia Pacific
Cyber-security • Released new 2020 • Lack of strict cyber • Draft of Cyber Security • New law on cyber-
Cyber Security Strategy security laws and Resilience Act security
Other • Proposal to place limits • Increased tax rates and • Strengthening money • Relaxed foreign
initiatives on cash payments to restricted stamp duty market infrastructure ownership restrictions
benefit digital payments remissions • Initiatives to
• Renewed Governance, • Legalised digital asset strengthen payment
Culture, Remuneration and crypto trading landscape
and Accountability
(GCRA) standards

19 | Digital Wealth Managem ent in Asia Pacific

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 Regulatory trends that support digital wealth management and private
banking

Government support to FinTechs Strong focus on governance

to intensify competition and consumer protection

Most governm ents in the region are supporting Certain governm ents in the region are trying to strike
FinTechs by relaxing regulatory requirements and a balance between innovation and m aintaining
p romoting sandb oxes, etc., with the aim to intensify regulatory guidelines that ensure consum er
com petition and prom ote digital advancem ents protection. They are trying to develop a sup ervisory
brought in by these new players. infrastructure that supports financial and consum er
protection, such as the GCRA standards in Australia,
As a result, we can expect foreign banks to face
Om budsm an schem e for digital transactions in India
increased comp etition from these em erging players,
and new online lending rules in m ainland China.
over and above the existing stronghold of traditional
dom estic banks in m ost of these m arkets. Further, governm ents are also focused on
strengthening cyb er-security capabilities to m itigate
One key approach adopted by the incum bents is to
the growing risk of cyber threats, thereby gaining
start investing in, acquiring, or p artnering with
custom er confidence to carry out online financial
these FinTechs to not only enhance their digital transactions effectively.
capabilities, but to reduce com petition as well.
Developing in-house capabilities to rival these players Banks should keep an eye on these regulations in
can also be an effective approach, particularly in less different m arkets to ensure com pliance and identify
developed m arkets. effective m easures to m anage the related costs.

Key markets Key markets

Mainland China Australia Mainland China India Australia

Indonesia Malaysia

Opportunities from open Increased focus on cross-

banking border capabilities

As m any governm ents in the region are prom oting All governm ents are taking initiatives to enhance
Open Banking, sharing of clients’ data is expected to cross-border transactions in the region, such as
allow banks to offer a variety of financial services, Wealth Managem ent Connect in the GBA, to expand
providing custom ers with a better experience and the m arket connectivity and reduce cross-border
m ost relevant choices. paym ents cost.
With access to this customer data from a com m on These initiatives provide investors with greater
platform , banks should look to strengthen their data product diversity and asset allocation options, along
analytics capabilities to innovate their offerings. These with im proved product design, service quality and risk
include: m anagem ent.
• digital onb oarding of clients using data collected Since, dom estic banks in m any of these m arkets have
through the new platform relatively less developed offshore infrastructure,
foreign banks can leverage their stronghold in the
• dynamic financial p lanning based on clients’
Hong Kong (SAR), China and Singap ore offshore
spending patterns, savings and incom e
wealth m arkets to act as a one-stop shop for
• providing p ersonalised p roduct facilitating clients’ offshore banking needs.
recommendations based on risk appetite
Banks can also use their wealth m anagem ent and
• offering alternative investment op p ortunities private banking expertise to b uild infrastructure in
by looking at clients’ preferences other neighb ouring markets that can m eet the
• allowing trading credit looking at client’s financial needs of the investors.
investm ents held with third parties
Key markets
These deliver m ore value to the clients by creating
new ways of growing their wealth.
Mainland China Australia Indonesia

Key markets Malaysia

Singapore Hong Kong (SAR), China Australia

Digital Wealth Managem ent in Asia Pacific | 20
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 Singapore

21 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Strong internet penetration and tech-savvy customers pushing the

adoption of digital tools and channels

Home to a growing Ultra HNWI (UHNWI) population

Singapore has been one of the top 10 locations in term s of growth in UHNWI residents.9 In 2019, there were 3,306
UHNWIs residing in Singapore.10 This figure is projected to grow by 29 percent by 2024.11
%
• Since 2000, wealth per individual in Singapore has increased 5.3 percent, considerably higher than the growth
rates in Asia Pacific.12

~0.3M
People with $1+ million in
~75%
In terms of household
investable assets (including wealth per adult
their primary residence), within Asia and sixth
reflecting high average in the world14
wealth13

Digital Wealth Managem ent in Asia Pacific | 22

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 Singap ore

Rising wave of tech-savvy Growing adoption of digital and

consumers mobile banking as well as digital
The well-established IT infrastructure of payment channels such as e-wallets
Singapore has m ade its consum ers m ore tech- Being a hom e to tech-savvy custom ers and
savvy, driving them to increasingly dem and with a strong internet and sm artphone
technologically advanced products over penetration, the adoption of m obile banking in
traditional offerings. This also m akes them Singapore has grown, up from 53 percent in
readily em brace digital tools and digitalised 2018 to 65 percent in 2019.17 However, it is still
investm ent products. significantly lower than that of m ainland China.

The digital paym ents space of the Singapore

m arket is developing at a rapid pace with
Internet penetration in consum ers shifting to digital wallets and QR

88%
codes from the card-based system . By 2020,
Singapore, with a total
digital paym ent users are projected to reach 3.1
of 5.1 million internet m illion and by 2021 digital wallets are expected
users15 to m ake ~22.5 percent of e-com m erce sales.18
• Grab, DBS’ Paylah, Favepay, EZ-Link and
Alipay are the leading wallets in term s of
usage and hold significant m arket share.
of all internet users
82% use a smartphone to
access the internet16 Singapore citizens

65% used mobile banking

in 2019, compared
with 41% in 201819

The consum ers in the m arket are also

increasingly dem anding m ore interaction and
better digital experiences, creating opportunity Total transaction value
for banks to enhance their digital offerings,
launch new innovative products and provide
custom ised finance solutions.
15.4B in digital payments
projected by 202020

According to a recent survey conducted by

Finder, Singapore is ahead of m any m arkets in
term s of digital banking adoption. It revealed
that currently 20 percent of adults have an
account with a branchless bank, and this figure
is expected to rise to 33 percent by 2025.21
Moreover, the COVID-19 pandem ic is likely to
act as a catalyst in digital transform ation in the
m arket and fuel the adoption of digital banking.

23 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Opportunities for banks to collaborate with FinTechs and offer a

broader range of services

Increased collaboration between banks Singapore’s rising FinTech sector

and FinTech players to drive digital Benefitted by highly skilled workforce, well-
transformation established IT infrastructure and strong
regulatory environm ents, Singapore has
Banks in Singapore are actively investing in technology
em erged as the leading m arket in Southeast
and focusing m ore on collaborations to protect their
Asia in term s of total FinTech investm ent
business m odels.
dollars as well as consum er adoption.
According to S&P Global’s report, the FinTech space in
According to an analysis by Oliver Wym an,
the Singaporean m arket is likely to be m ore
investm ents in Singapore’s FinTech space grew
collaborative than disruptive, with banks preferring to
from US$642 m illion in 2018 to US$861 m illion
form an alliance rather com peting with them .22 In the
in 2019.23 Also, the sector witnessed a
wealth m anagem ent space, banks are collaborating
significant rise in the num ber of deals vis-à-vis
with WealthTech players to enhance their digital
2018.
offerings.
% b reakdown of funding in FinTech firms, b y
• HSBC collaborated with Bam bu, a robo-advisory sub -sector (2019)24
solutions provider, to offer an online HSBC Wealth
Planner platform in Singapore.
• OCBC bank partnered with WeInvest to launch 5%
robo-advisory and digital wealth services. 4%
11%
37%
Banks look to provide data-driven
customised finance solutions
100% =
Banks are m aking strong efforts to leverage m ore
19% US$861 M
client data to bring higher custom isation in the m ass
affluent segm ent in wealth m anagem ent.
24%
• DBS announced the launch of a new feature that
will convert custom er data into ‘hyper-personalised’
recom m endations for custom ers to m anage their
finances and investm ents. It also intends to deliver
custom ised m arket insights based on custom ers' Payments WealthTech
investm ents and behaviour. Lending InsurTech
• SCB launched a personalised investm ent tool that RegTech Others
uses Big Data to help its relationship m anagers
advise affluent clients. Source: CB In sights, SFA-OW FinTech Survey 2020, n =63,
Oliver Wym an analysis

Impact of COVID-19
The FinTech space continued to gain m om entum in 2020 and has witnessed
significant deploym ent of funding in the second quarter despite the COVID-19
pandem ic.
• According to a report by the Singapore FinTech Association, total financial
technology investm ents increased m ore than 300% in 2Q20.25
However, the pandem ic caused restructuring at a num ber of banks as well as delayed
the approval of working visa applications and strictness in approving foreign hires that
forced expat private bankers to m ove back to their hom e regions, leading to reduced
talent in private banking sector in the Singapore m arket.

Digital Wealth Managem ent in Asia Pacific | 24

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 Singap ore

Rising growth in family offices

with shift towards onshore
wealth management

Shift from offshore to onshore wealth

management
Singapore is the second m ost preferred place in the
world for offshore wealth m anagem ent. In 2018, total
global offshore wealth stood at US$10.3 trillion, out of
which Singapore accounted for about 11.7 percent
(US$1.2 trillion).26
Supported by its depth of banking services, effective
regulations, and highly transparent governm ent, the Robust increase in family offices
m arket has attracted various investors including asset
Singapore has been one of the preferred wealth
m anagem ent firm s, bank subsidiaries, and
m anagem ent and private banking centres for
corporations to establish their private offshore
Asian fam ilies and in past few years has
trusts/com panies.
witnessed a steep rise in fam ily offices.

The m ajority of these investors The num ber of fam ily offices in
are from the Southeast Asian Singapore grew four-fold during
m arkets, m ainland China, India, 2015–17 and has continued to
and Europe. grow steadily since 2018.28

In 2019, Singapore em erged as Acknowledged for its political stability, solid

the biggest FDI host in Southeast financial sector, favourable tax regim e and
Asia, reporting a 42 percent year- highly skilled workforce, Singapore has been
on-year growth in FDI inflows.27 able to attract m any fam ily businesses.
• Regulators are increasingly m aking efforts,
However, in the wake of the arrival and
such as tax incentives, special funds
im plem entation of global reporting standards such as
structures and prom ising residency to lure
Com m on Reporting Standards, and substantial
fam ily offices, aim ing to position Singapore
requirem ents in traditional offshore jurisdictions such
as the leading wealth m anagem ent hub in
as the British Virgin Islands and Caym an Islands,
Asia.
there has been a worldwide shift am ongst HNWIs
and UHNW fam ilies to ‘onshore’ wealth structures in Moreover, the shift in favour of Singapore as a
Singapore. preferred wealth m anagem ent destination will
support the growth of fam ily offices in the
This shift can be clearly witnessed with banks such
Singaporean m arket.
as UBS and Credit Suisse investing m ore and m ore in
their onshore/nearshore capabilities. • A few of the banks including DBS have
revealed that they are benefitting from a
Moreover, lim ited travelling am id COVID-19 is further
growing trend of global fam ily offices and
expected to accelerate the trend of storing wealth in
planning to setup a dedicated capability in
onshore/nearshore areas.
Singapore.

Benefiting from regional uncertainty

Singapore is expected to benefit by any increased
uncertainty in the operating environm ents of rival
cities in the region. For instance, it has been reported
widely that several international wealth m anagem ent
houses have decided to set up offices in Singapore in
favour of other potential locations to capitalise on the
relative stability of the city in regional geopolitical
term s.
• Moreover, it has been widely reported that som e
of the leading private banks including UBS, Credit
Suisse and Julius Baer plan to increase staff
m anage m ainland China and Hong Kong offshore
wealth, particularly focusing on Singapore.

25 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Government implementing new policies to promote digital banking in

Singapore

The government of Singapore has implemented several regulatory reforms that support the
growth of digital financial services in the market. The new Payment Services Act and issuance of
digital banking licences, coupled with a strong cybersecurity regime and development of a
regulatory sandbox is enabling Singapore to come up as a market that offers advanced financial
products.
Launch of Payment Services Act 2019 to New rules to strengthen cyber resilience
bolster payment services of FS sector
In 2019, the MAS announced the new Paym ent Services In August 2019, the MAS issued a set of legally
Act to provide regulatory certainty and consum er binding requirem ents — Cyber Hygiene Notices —
safeguards, while encouraging innovation and growth of m andatory for all the financial institutions to m itigate
paym ent services and FinTech. the growing risk of cyber threats.
• The Act aim s to establish a licensing regim e and These requirem ents are expected to raise the cyber
provide direct oversight of paym ent system s and security standards and strengthen cyber resilience of
paym ent service providers. the financial sector, thus boosting the confidence of
• The Act also expands the MAS' regulatory powers to clients to carry out online financial transactions
new types of paym ent services such as e-m oney effectively.
issuance services and digital paym ent token services.
Im plem entation of this Act will prom ote broader adoption Sandbox Express launched for faster
of digital paym ents. New players are expected to enter
the m arket, exploring and offering alternative paym ent testing of innovative FS products
gateways/acquirer services, replacing the traditional In August 2019, the MAS launched Sandbox Express
banking network infrastructure. to provide FS firm s with a faster option to test
innovative financial products and services in the
m arket, by relaxing the existing Sandbox approvals
Virtual banking licences to promote digital process.
banking and competition It is suitable for innovations where risks are low and
In June 2019, the MAS announced its intentions to issue can be m anaged within pre-defined param eters.
virtual banking licences to prom ote digital banking. It will FinTechs with m ore com plex m odels can apply to the
issue five new virtual banking licences, including two full existing 2016 FinTech Regulatory Sandbox.
digital banking licences, and three digital wholesale • One of the leading wealth m anagem ent platform s
licences exclusively for SMEs and other non-retail in Singapore — Kristal.AI — entered the sandbox
segm ents in Singapore. Additionally, existing banks can in 2017 to experim ent with its digital product
launch their own digital banks. offerings.
This m ove will allow technology players and non-banking This will pull m ore WealthTech players to experim ent
com panies to m ove up the value chain and challenge with new technologies before going to m arket.
traditional lenders. This will also draw m ore foreign
players to enter the m arket, thereby giving strong
com petition to dom estic banks.
As of June 2020, the MAS inform ed that of 21
applications received, 14 applicants (undisclosed) have
m oved forward to the next phase of its evaluation Digital Wealth Managem ent in Asia Pacific | 26
process.29
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 Singap ore

Strategic initiatives to enhance wealth management capabilities

In the past year, the Government of Singapore has launched new frameworks to promote
Singapore’s position as a prominent funds hub, with greater cross-border services to customers. It
has also introduced new rules and guidelines to improve the overall ease of doing business, such
as relaxation for robo-advisory service providers.

Launched new structure for corporate Updated guidelines for fund managers
funds In October 2019, the MAS updated the Guidelines on
In January 2020, the MAS launched the Variable Licensing, Registration and Conduct of Business for
Capital Com panies (VCC) fram ework, a new corporate Fund Managem ent Com panies.
fund structure tailored for collective investm ent These guidelines describe the eligibility criteria and
schem es. application procedures for different types of fund
• The fram ework is expected to cem ent Singapore’s m anagem ent com panies as well as set out business
asset and wealth m anagem ent sector’s position in conduct requirem ents related to custody, valuation
the m arket as a prom inent funds hub. and reporting, conflicts of interest m itigation,
disclosure and subm ission of periodic returns.
• With the option to set up an um brella fund, VCC
provides fund m anagers with operational flexibility The continuous updates have brought clarity on
as well as cost savings from scale, thereby, business activities to be conducted by fund m anagers
attracting m ore offshore funds to be dom iciled in and licence application standards to adhere to, leading
Singapore. to easier and transparent procedure for the players
trying to enter the m arket.
• The VCC fram ework is also expected to attract
higher interest from large fam ily offices and trusts
to set up investm ent vehicles in Singapore by
providing benefits such as access to capital
shares, transparency and reasonable taxation.
Since the launch of the fram ework, over 20
investm ent funds have been launched in the form of
the VCC structure.30

27 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Revised exemption framework for cross-

border arrangements of capital markets
intermediaries
In June 2020, the MAS proposed revisions to
stream line the exem ption fram ework for business
arrangem ents between financial institutions in
Singapore and foreign-related corporations (FRCs), by
m oving away from the current approval-based regim e
to a new notification-based regim e.
The new fram ework will allow FRCs to provide cross-
border services related to capital m arkets to
custom ers in Singapore without having to hold a
licence. As a result, the overall service offerings
provided to the custom ers are expected to broaden
within the m arket.

Relaxed rules for robo-advisory service

providers
In October 2018, the MAS issued guidelines on
provision of digital advisory services in Singapore,
which involved certain relaxations for the providers.
Under the guidelines, firm s offering digital fund
m anagem ent advisory services to retail investors are
exem pted from the corporate track record and AUM
requirem ents set by the Securities and Futures Act.
However, they are required to adhere to certain
requirem ents, leading to developm ent of new online
business m odels that provide investors with m ore
options to access investm ent advice.

Digital Wealth Managem ent in Asia Pacific | 28

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 Singap ore

Large number of players providing access to global markets, with strong

focus on digital wealth services

Comprehensive suite of wealth Digital wealth service providers

management players operating in the transforming traditional services
market The next generation digital wealth platform s are
A large num ber of dom estic and foreign players are transform ing traditional roles and propositions of
operating in the m arket that offers its HNWIs access bank-based wealth m anagers to m ore holistic
to global and regional financial m arkets, along with a investm ent advisory and asset m anagem ent services.
gam ut of wealth m anagem ent services. Players such as WeInvest, AGDelta and Bam bu are
Three local banks — DBS, OCBC and UOB — hold a offering m ore efficient and autom ated B2B processes
com bined m arket value of m ore than S$150 billion.31 at lower costs with m ore viable options for investors,
even for those in the lower m ass affluent segm ents.
• Offering robo-advisory services and creating digital
platform s using data analytics, particularly focused Certain wealth m anagers are also exploring ways to
on trading and financial planning are som e of the partner with these platform s to offer alternative
com m on developm ents in this segm ent. m odes of distribution and product delivery to their
clients.
• DBS provides a digital financial planning
solution — NAV planner — that leverages data • In August 2018, OCBC Bank partnered with
analytics to recom m end custom ised solutions, WeInvest to launch its robo-advisory and digital
depending on clients’ life stages and financial wealth services.
circum stances. Moreover, technology players such as Ant Group,
• Citi leverages Thom son Reuters, a stock Grab and Tencent are entering the wealth
analytics tool to support investm ent decisions. m anagem ent space.
• Grab acquired a robo-advisory app Bento —
rebranded as GrabInvest — to sell retail wealth
m anagem ent and financial planning products.

29 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Comparison of digital capabilities and offerings by leading players for HNW clients
In Singapore, both banks and platform -based wealth m anagers provide a wide range of digital capabilities. Traditional
banks are well placed in providing digitised trade execution and client interaction capabilities, whereas WealthTechs
m ainly provide robo-advisory services and portfolio recom m endations powered by Big Data analytics.

Digital capabilities DBS Citi SCB HSBC UBS UOB OCBC AutoWealth Connect Kristal.AI StashAway
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Customer Features

research and insights

Portfolio management ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔ ✔ ✔ ✔ ✔ ✔

Digital account opening ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Financial planning, analysis,
goal and investment ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
tracking
FX trading ✔ ✔ ✔ ✔ ✔ ✔ ✔
Digital execution

Equity trading ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Fixed Income trading ✔ ✔ ✔ ✔
Structured Product booking ✔ ✔
Funds (ETF) trading ✔ ✔ ✔ ✔ ✔ ✔
IPO subscription
Robo-advisory ✔ ✔ ✔ ✔ ✔ ✔ ✔
solution
Internal

Big Data analytics ✔ ✔ ✔ ✔

Digital offering to facilitate
client interactions ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Leading traditional banks Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

Digital Wealth Managem ent in Asia Pacific | 30

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 Singap ore

An opportunity for banks looking to reposition themselves as innovative

and progressive wealth managers

Recommendations
Given the current wealth m anagem ent landscape for
Singapore, there is a vast opportunity for banks to
reposition them selves as innovative and progressive
wealth m anagers, with a view to becom ing m arket
leaders in the next three to five years.

Banks should focus on providing m ore custom ised

platform s to their clients, that can offer real-tim e
analysis and reporting of investm ent portfolio,
autom ate re-balancing of portfolio in response to
m arket events, and provide recom m endations for
different investm ents tailored to clients’
requirem ents.

They should also increase their investm ents in robo-

advisory solutions to provide personalised
recom m endations, and advanced data-driven
technologies, such as Big Data analytics, AI, for
generating m odels to forecast future investm ent
growth.

Banks can also look to partner with leading B2B

digital wealth service providers to offer m ore efficient
and autom ated processes at lower costs with m ore
sustainable options for investors.

31 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Leading players and their digital

wealth management offerings

Leading traditional banks

DBS Citi

Descrip tion Descrip tion

• Leading financial services group in Asia, with very • One of the largest foreign banks in Singapore
high banking penetration (98%)
• Introduced Citi PayAll, enabling credit card
• Provides unique digital offerings in each segm ent; paym ents for rent and education on m obile
built up ~3.3 m illion custom ers on digital devices.
platform s, allowing them to undertake banking
• Launched digital onboarding for institutional clients
transactions from paym ents to investm ents
through CitiDirect BE
• DBS Vickers, the brokerage arm of DBS,
• Continued to enhance wealth m anagem ent
continues to build up its digital capabilities and
capabilities by investing in offerings and digital
introduced innovative solutions, including online
tools to m eet a wider spectrum of custom er needs
custom er onboarding and direct debiting/crediting
for trades done across eleven exchanges in core • Citi Priority serves the needs of em erging affluent
m arkets clients; Citigold and Citigold Private Clients offers
institutional-grade and personalised wealth
• DBS Treasures Private Client and DBS Private
m anagem ent services
Bank offer personalised investm ents and wealth
advisory services to affluent clients

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• DBS iWealth® , a dedicated platform for wealth • eFX, an online platform , eases access to the FX
m anagem ent clients, allows users to choose from m arket and provides services that are tailored to
over two hundred Funds and Unit Trusts in twelve users’ foreign currency trading needs
currencies, trade equities across seven global
• eBrokerage allows to invest in securities, m onitor
m arkets, m onitor banking, trading and wealth
stock prices, track trading m ovem ent and provide
portfolio, provides users with research and
access to free real-tim e stock quote services and
insights, and price alerts relevant to their
international news and research
investm ent portfolio
• Uses Thomson Reuters Stock Analytics tool
• DBS digiPortfolio, a hybrid hum an-robo solution,
enables consum er banking/wealth m anagem ent that provides a series of stock m arket insights
and analysis to assist users’ investm ent
custom ers to gain financial expertise and
decisions
investm ent opportunities, but usually lim ited to
ultra high-net-worth clients • Total Wealth Advisor, an online tool, gives users
a com plete view of their asset allocation and
• Launched a new com prehensive digital financial
allows them im m ediate access to a
planning solution — NAV p lanner — that
com prehensive and holistic view of their financial
leverages data analytics to recom m end tailored
position
solutions to custom ers depending on their life
stages and financial circum stances • Digital Bank provides a digital wealth
m anagem ent platform that facilitates real-tim e
• Launched DBS Treasury Prism, their first online
m oney transfer for wealth m anagem ent clients
treasury and cash m anagem ent sim ulation tool
and enables the bank’s relationship m anagers to
that features an ‘Optim isation Score’ derived from
a sm art algorithm and takes into account the interact with their Private Banking and Citigold
Clients through live chat
interest yield and debt, tax, bank fees and
corporate costs, helping users quantify the • Introduced Citi® Glob al Collect, a new cross-
benefits of each structure border platform that allows clients to m anage
cross-border business-to-business paym ents by
digitising the transaction process and em bedding
FX capabilities

Digital Wealth Managem ent in Asia Pacific | 32

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 Singap ore

Leading players and their digital

wealth management offerings

Leading traditional banks

Standard Chartered Bank (SCB) HSBC

Descrip tion Descrip tion

• One of the largest foreign banks in Singapore with • One of the leading traditional banks in Singapore
digital banking penetration of 54 per cent
• Continued to m ake significant investm ents in
• Launched real-tim e client on-boarding on digital enhancing its digital capabilities
channels
• Launched eSignature on Wealth Tablet, where
• Priority Private offers a suite of personalised docum ents can be sent electronically to
wealth solutions with exclusive privileges to custom ers for their signatures to com plete
affluent clients investm ent-related transactions
• Introduced Prem ium Banking service to serve • Launched a dedicated independent asset
em erging affluent clients m anagem ent unit catering to the needs of fam ily
offices and independent advisers m anaging
• Launched Im pact Philosophy for high-net-worth
wealth on the behalf of their clients
clients to offer sustainable financing services
• HSBC QuickFX app enables custom ers to actively
m anage and plan for their foreign currency and
rem ittance needs and provides a suite of other FX
solutions
• HSBC International Mortgage enables custom ers
to diversify portfolio, with preferential rates as a
HSBC Jade client

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Introduced LiveFX, a real tim e FX conversion • HSBC Wealth Planner enables custom ers to m ap
platform out their wealth goals and assess their financial
health online and Wealth Insights Hub provides
• Online Unit Trusts p latform allows portfolio
custom ers with real-tim e access to financial
funding and portfolio m anagem ent with an
insights and investm ent-related educational
em bedded feature to track perform ance and
inform ation
access research tools
• HSBC Wealth Dashb oard gives users a com plete
• SC Online Trading tool allows sm art and
view of their investm ents, analyses portfolio from
seam less trading at 15 stock exchanges, across
different angles and provides latest financial news
10 m arkets
and insights, autom atically sorted by relevancy to
• Exchange Traded Funds (ETFs) selector tool the current portfolio holdings
helps to filter ETFs available for online trading
• HSBC Jade provides online tools and hum an
• Technical and fundam ental stock analysis tools expertise to m anage clients’ wealth
help to analyse m arket m ovem ents and
• Inbuilt with end-to-end financial planning and
identify the m arket entry or exit points
tracking capabilities, HSBC Wealth Portfolio
• SC DigiAdvisory connects users with relationship Plus leverages technology, and offers
m anagers or insurance specialists to offer tailored analytical capabilities to investors, helping
wealth m anagem ent advice them to track the progress of their financial
goals and take inform ed decisions on their
investm ents
• HSBC Structured Product Online Platform
allows accredited investors to invest in
structured products offered by the bank

33 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Leading players and their digital

wealth management offerings

Leading traditional banks

UBS United Overseas Bank (UOB)

Descrip tion Descrip tion

• UBS in Singapore was established in Septem ber • One of the leading traditional banks in Singapore
1970. It is ranked am ong the leading wealth with digital banking penetration of 96 percent
m anagers in the m arket (includes ATM transactions)
• Singapore is one of the two m ajor international • Bank’s relationship m anagers leverages AI,
booking centres for UBS' Global wealth advanced data analytics and digital wealth advisory
m anagem ent business in the region tool, to recom m end suitable investm ent solutions
to the custom ers
• Singapore is the single trading hub in Asia for
Forex, Rates and Credit • UOB Private Bank focusses on the investm ent
goals of high net worth clients
• Launched its first Asia Pacific innovation centre
(EVOLVE) in Singapore
Digital offerings in wealth management and
• Was awarded as the Best Private Bank services
p rivate b anking or for affluent clients
overall and best Private Bank for tech at
Professional Wealth Managem ent Global Private • UOB Portfolio Advisory Tools, a digital wealth
Banking awards, 2019 m anagem ent platform , consists of a suite of three
com plem entary digital tools:
• Portfolio Tracker tracks one’s portfolio health
Digital offerings in wealth management and
with an overview of their entire product
p rivate b anking or for affluent clients
holdings, together with gains and losses
• Offers UBS Mobile Banking and UBS Access
• Portfolio Insights provides insights on how
applications, that allows custom ers to track
the bank’s recom m ended portfolio com pares
portfolio perform ance, to access insights, view
with the custom er’s current portfolio;
investm ent dashboard and to understand their risk
showcases a holistic risk-return analysis and
tolerance
robust scenario sim ulations by stress-testing
• Users can also access details and m arket news for portfolios in various significant m arket events
instrum ents in m ultiple asset classes, set price
• Portfolio Exp lorer allows a 360 degree
alerts to track investm ent opportunities and trade
evaluation of a custom er’s portfolio across
in equities, bonds and funds in global m arkets via
various risk and perform ance param eters –
web/m obile based platform
dynam ically, in real-tim e with a live m arket
• Allows its custom ers to directly interact with data feed
advisors using different com m unication channels
• UOB Cap ital Builder allows fund diversification,
such as WeChat and WhatsApp
provides greater access to investm ent
• Offers UBS Manage™ service under which opportunities and achieve sustainable capital
investm ent experts will m anage portfolio, but the growth across m arket cycles
clients have the option to m onitor their
• UOB Asset Management Invest, a robo-advisory
investm ents, change their investm ent strategy
app personalises custom ers’ portfolio aligned to
and question their advisors
their investm ent objectives
• With UBS AdviceTM , it allows clients to m anage
• Launched MyPortfolio, a digital investm ent
their investm ents on their own and provide them
dashboard to provide an integrated overview of
with expert advice based on their goals and risk
portfolio to HNWIs
appetite
• Provides online trading platform for stocks —
UTRADE, with price alerts, trading insights,
fundam ental and technical analysis

Digital Wealth Managem ent in Asia Pacific | 34

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 Singap ore

Leading players and their digital

wealth management offerings

Leading traditional banks

OCBC (Oversea-Chinese Banking

Corporation)
Digital offerings in wealth management and
Descrip tion p rivate b anking or for affluent clients

• One of the longest established Singaporean banks • Launched a full suite of goal-based advisory and
that provides private banking services through its financial planning solutions on digital platform s
separate banking arm , Bank of Singapore • OCBC Mob ile Banking ap p provides access to
• OCBC Prem ier Banking platform caters to the m arket insights and investm ent ideas, allows
affluent segm ent and OCBC Prem ier Private Client users to keep track of investm ent portfolio and
caters to the HNWI segm ent provides personalised recom m endations based on
users’ holdings
• Continued to deploy solutions supported by AI
across the bank’s wealth advisory, risk • OCBC Rob oInvest allows its users to invest in
m anagem ent, cyber security and com pliance units thirty three them atic portfolios, such as
precious m etals, im pact investing and PRC
growth, across six m arkets for a wide range of
risk appetites or investm ent preferences;
allows autom ated portfolio m onitoring and
24/7 accessibility to investm ents with digital
banking
• iOCBC Online Trading Platform provides direct
m arket access to both local and overseas key
securities exchanges, allows tracking of cash,
m argin and share borrowing portfolios, and receipt
of trade confirm ations
• iOCBC TradeMob ile allows m anagem ent of
investm ents via m obile

35 | Digital Wealth Managem ent in Asia Pacific

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 Singap ore

Leading players and their digital

wealth management offerings

Leading wealth management platforms

AutoWealth Connect

• A licensed digital financial advisor that uses a • A prem ier digital advisor in Singapore that
proprietary algorithm to provide financial advice provides personalised advice and com bines the
and investm ent m anagem ent online latest technology and academ ic research for its
custom ers so that they can take control of their
• Have autom ated process that cuts down the
investm ents and m axim ise their returns
processing tim e and m iddlem an costs while
providing custom ised recom m endations to the • Allows end-to-end digital onboarding and provides
custom ers on the ideal com position of their unique asset allocation for investors with different
investm ent assets financial goals and risk tolerances
• Uses passive m arket-returns portfolio investm ent • CONNECT Prim e offers services and investm ent
approach and places strong em phasis on portfolio choices to accredited investors that are norm ally
allocation and diversification without m arket reserved for only ultra high net worth private
speculation, allowing custom ers to earn greater banking clients
returns
• Provides a com plete package of private
• Allows cost-efficient diversification through index- banking services under one roof and 24/7
tracking ETFs, provides com prehensive reports of online access to view and m onitor portfolio
accounting for entire assets and follows hybrid perform ance
m odel by providing a dedicated wealth m anager
• Allows self-directed trading in equities and
regardless of the investm ent am ount of the
fixed incom e, provides detailed, real-tim e
custom er
portfolio reports and access to prem ium
research

Kristal.AI StashAway

• An online investm ent platform that focuses on • A digital wealth m anagem ent service provider that
providing personalised products and advice to its com bines personalised wealth m anagem ent and
clients financial planning services through its data-driven
investm ent fram ework to offer globally-diversified
• Functions on a hybrid m odel that leverages
portfolios
advanced algorithm s and investm ent
professionals’ strategies to assist users to invest • Platform analyses financial assets, investm ent
in a variety of financial products (private equity, tim e horizon, and risk preferences to
pre-IPO deals, VC Funds & other investm ents personalise custom er’s portfolio through a
including bitcoin, gold, hedge funds, etc.) and system atic asset allocation strategy
select the investm ent portfolio that suits their
• Launched an SGX-traded incom e-generating
return-risk preference
portfolio that aim s to provide investors with an
• Gained a significant m arket share in Singapore and incom e of 3.75 percent and capital appreciation of
focused on scaling geographically in other Asia 4.4 percent annually; the portfolio was listed
Pacific locations with differentiated offerings am ong the top ten new funds in 3Q19 by Citywire
Asia

Digital Wealth Managem ent in Asia Pacific | 36

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 Hong Kong (SAR),
China

37 | Digital Wealth Managem ent in Asia Pacific

© 2021 KPMG, a Hong Kong partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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 Hong Kong (SAR), China

Efficient IT infrastructure with growing online and mobile banking

adoption

One of the best IT infrastructures globally

Hong Kong has one of the world's m ost sophisticated IT infrastructures, ranking third on average fixed broadband
internet speed and fourth in term s of 4G accessibility in 2019.32 As a result, the leading banks in Hong Kong have
% spearheaded a strong wave of technological enhancem ents over the past two years.

91%
Internet penetration in
~75%
Smartphone penetration in Hong
Hong Kong, with a Kong, with 97% of all internet
total of 6.8 million users using a smartphone to
internet users33 access the internet34

Digital Wealth Managem ent in Asia Pacific | 38

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 Hong Kong (SAR), China

Growing adoption of advanced Home to a growing UHNW

digital services such as mobile population
banking and digital wallets Hong Kong has grown in stature as a wealth
With strong internet and sm artphone m anagem ent centre, owing to a large
penetration, the adoption of m obile banking in concentration of UHNW population driving
Hong Kong is growing. However, it is still dem and for digital financial services. Offshore
significantly lower than that of m ainland China, clients also m ake up an im portant part of the
leaving am ple room for im provem ent. The sector.
usage of m obile wallets is rising rapidly as it
offers m ore personalised services, seam less
paym ent experiences, and integrated People with net worth
paym ents. interfaces to custom ers. over US$1 million
• WeChat Pay, Alipay and O!ePay are the
leading players in term s of usage and have
gained significant m arket-share in the past
~0.6M (including their primary
residence), witnessing
growth of 123%
few years 35 during 2014–1939
• HSBC’s PayMe is also one of the m ost
successful paym ents apps in Hong Kong,
with over 70 percent of Hong Kong In terms of UHNW
m illennials using it36
#1 population per capita,
globally40

Hong Kong citizens

used mobile banking

43% in 2019 to interact

with their banks,
compared with 30%
Marked improvement in meeting
HNWI’s digital expectations
in 20183 7
According to KPMG’s Hong Kong Private
Wealth Managem ent Report 2020, wealth
m anagers m arked a significant im provem ent in
Consumers are active m eeting clients’ digital expectations, com pared
users of mobile to 2019, driven by firm s’ accelerated digital

~90% wallets, with ~60%

using their mobile
transform ation and a clear focus on digital client
engagem ent, as a result of COVID-19.41
wallet every week3 8
Private wealth
management firms
59% believe that their
digital offerings meet
client expectations42

39 | Digital Wealth Managem ent in Asia Pacific

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 Hong Kong (SAR), China

Incumbents realising collaboration opportunities with WealthTechs to

offer a broader portfolio

Booming WealthTech industry in Hong Rapid technology adoption to be a

Kong key growth enabler and essential to
With shifting dem ographics and favourable regulations, face competition from new entrants
the WealthTech industry is rapidly growing in Hong According to KPMG’s Hong Kong Private
Kong. According to Hong Kong’s Financial Services and Wealth Managem ent Report 2020, private
the Treasury Bureau, 57 new FinTech firm s entered the banks and wealth m anagers in Hong Kong
m arket in 2019, of which WealthTech form ed 20 expect ~20 percent of current offline client-
percent (the second-fastest growing sector) followed advisor interactions to be conducted over digital
by paym ents (17 percent).43 channels over the next five years.45 To adapt to
this, they are investing in new technologies
% b reakdown of new FinTech firms in Hong Kong, broadly focused around three areas:
b y sub -sector (2019) 44
• increasing use of value-added features
2% within online and m obile platform s such as
6%
portfolio sim ulation tools and education
Blockchain m aterials
7%
WealthTech • enabling m ore sophisticated products to be
9% 39% Payments sold online such as structured products
100% = InsurTech • investing in non-client facing tools that help
57 firms RegTech
relationship m anagers to com plete their
17% roles m ore effectively and efficiently
CreditTech
However, certain regulatory changes like
20% Cybersecurity im plem entation of product suitability regulations
around com plex products (enacted by the
Source: Fin ancial Services and th e Treasury Bureau, Securities and Futures Com m ission in July
Govern ment of the Hong Kong Special Administrative Region 2019) is com pelling wealth m angers to divert
technology resources away from developm ents
that enhance client experience to developm ents
The WealthTech industry is gaining increased that ensure com pliance.
m om entum in 2020 and has seen several
developm ents, with a num ber of foreign players These increased regulatory requirem ents are
entering the m arket.
adding further com plexity to client processes,
m aking it m ore challenging to develop
regulatory com pliant digital services that also
In April 2020, Social Finance, a offer im proved client experience.
consum er financial services platform ,
m ade its first expansion outside of the
US, with the acquisition of a Hong
Kong-based investing app — 8
Targeting younger generation likely
Securities. to be another key growth enabler
With m ore wealth being transferred to the next
In April 2020, Allfunds, a European generation via fam ily succession, and new
fund distribution platform , received the wealth being created by young entrepreneurs
licences from the Hong Kong using technology, this client segm ent is likely to
Securities and Futures Com m ission be a key growth driver for Hong Kong’s wealth
(SFC) to open its office in Hong Kong. m anagem ent industry.
• According to KPMG’s Hong Kong Private
Wealth Managem ent Report 2020, wealth
These foreign players are expected to provide stiff m anagers highlighted ‘holistic digital
com petition to Hong Kong’s hom egrown WealthTech ecosystem /m ulti-channel delivery’, ‘self-
players such as Aqum on and Quantifeed, which offer service investm ent platform s’ and ‘instant
robo-advisory based digital wealth m anagem ent m essaging apps’ as the top three
solutions to clients. capabilities to attract the younger
generation.46

Digital Wealth Managem ent in Asia Pacific | 40

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 Hong Kong (SAR), China

Rising competition in managing

wealth offshore, with significant
growth opportunities offered
from mainland China

Leading destination for managing

wealth offshore
Hong Kong is the one of the m ost preferred places in
the world for offshore wealth m anagem ent. In 2018,
total global offshore wealth stood at US$10.3 trillion,
out of which Hong Kong accounted for about 7.7
percent (US$0.8 trillion).47 Competition from emerging Asian
financial centres
Supported by a deep pool of liquidity and robust
financial infrastructure, Hong Kong has attracted Hong Kong has been experiencing a rise in
various investors including fam ily offices, bank com petition from other Asian m arkets to
subsidiaries and corporations to establish their private replace it as the region’s leading financial hub.
offshore trusts/com panies in the city. The m ajority of In 2019, the city reported a 48 percent dip in
the investors are from m ainland China, Japan and inward foreign direct investm ent (FDI), while
Taiwan. Singapore witnessed an increase of 42
percent.50
Mainland China has also started positioning
Significant growth opportunities with Shanghai and the Lingang New Area of
mainland China Shanghai’s Free Trade Zone as an international
financial hub, by introducing new policies in the
Hong Kong’s status as the gateway between
zone to deepen the participation of foreign
m ainland China and the rest of the world is an
trade.
im portant factor that enables it to benefit from
wealthy m ainland Chinese individuals looking to
diversify and m anage their wealth globally.

To m aintain its status as a global wealth m anagem ent

centre, it is im perative for Hong Kong that it
continues to capitalise on growth opportunities
offered by m ainland China.
• According to KPMG’s Hong Kong Private Wealth
Managem ent Report 2020, the m ajority of private
wealth m anagers highlighted m ainland China as
the m ain growth engine for Hong Kong. They
anticipate ~54 percent of Hong Kong’s wealth
m anagem ent AUM to com e from m ainland China
by 2025.48
This is strengthened by several initiatives jointly taken
by the Hong Kong and m ainland Chinese authorities,
such as Stock Connect program m es with both
Shanghai and Shenzhen stock exchanges as well as
Wealth Managem ent Connect in the GBA that aim s
to foster cross-border financial services and
transactions.
• Many wealth m anagers have started developing
products and services that tap into this
opportunity. According to KPMG’s 2019 report,
~64 percent of financial institutions already have,
or are planning to develop, a GBA-specific strategy
and operations.49
• Som e of them are also addressing the opportunity
either by hiring people from m ainland China or by
form ing partnerships and collaborations between
onshore and offshore platform s.

41 | Digital Wealth Managem ent in Asia Pacific

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 Hong Kong (SAR), China

Government is strengthening Hong Kong’s position as a FinTech hub in

Asia, with smart banking initiatives

In 2019, the HKSAR Government launched seven smart banking initiatives to embrace the
enormous opportunities brought about by the convergence of banking and technology, thereby
improving the quality of banking products and services for customers.

Key progress includes:

• Expanded the adoption of the Faster Paym ent • Developed an Open Application
System (FPS) that allows faster connectivity for Program m ing Interface (API) Fram ework,
paym ents and prom otes com petition am ong that allows financial institutions to open up
banking and non-banking service providers their internal IT system s and data for
program m atic access by third-party service
• Since the launch of the FPS, the num ber of
providers (TSPs), to im prove financial
participating service providers increased to 30
services through collaboration between
banks and 11 Stored Value Facilities (SVFs,
banks and tech firm s
including e-wallets and prepaid cards), with the
addition of nine banks and one SVF, by the end • Stepped up for cross-border collaboration in
of 2019 51 FinTechs, and launched a blockchain-based
trade finance platform nam ed
• Introduced FinTech Supervisory Sandbox 2.0 that
eTradeConnect that facilitates an open trade
lets banks and partnering FinTech firm s to conduct
finance network based on cross-border
pilot trials of their FinTech initiatives with a lim ited
distributed ledger technology (DLT)
set of participating custom ers, without the need
to achieve full com pliance with the Hong Kong • Enhanced FinTech research and talent
Monetary Authority’s (HKMA’s) supervisory developm ent; carried out a study on the
requirem ents application of AI in the Hong Kong banking
industry
• Introduced a new Banking Made Easy initiative to
reduce regulatory friction and im prove custom er
experience in online Finance and wealth
m anagem ent
• The scope of the initiative has been expanded
to include anti m oney laundering (AML)
surveillance technologies, RegTech for
prudential risk m anagem ent as well as studies
on m achine-readable regulations
• Initiated new m odes of delivery of financial
services by granting eight virtual bank licences,
thereby facilitating financial innovation in banking,
to enhance custom er experience and prom ote
financial inclusion

Digital Wealth Managem ent in Asia Pacific | 42

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 Hong Kong (SAR), China

Providing regulatory relaxations and other measures to open up to

global developments in Banking

Relaxed regulatory environm ent Unregulated trustee services

of Hong Kong m akes it an
attractive hub to establish • Except for the requirem ent to apply for a service
offshore trusts and fam ily offices licence, providers of trusteeship services are
largely unregulated in Hong Kong, m aking it an
attractive place for com panies, particularly fam ily
Governm ent along with the offices, to set up independent trusts and use
banking regulators, m ainly the offshore jurisdictions.
HKMA, continue to further
• Moreover, there are no legal restrictions on the
develop the banking industry
transfer of Hong Kong assets to trust entities,
except the transfer of certain assets, such as
shares in Hong Kong com panies and im m ovable
property, that are subjected to Hong Kong stam p
duty.
Relaxed taxation system
• Hong Kong does not have any form of sales tax,
such as goods and services tax, and value added
tax.
• The city also does not have any gift tax, estate
duty and capital gains tax m aking it an attractive
spot for investors, asset and fund m anagers to
operate in the region.
• However, gains m ade from trading, such as
buying and selling of shares or properties, m ay
be considered as profits and, therefore,
subjected to profits tax.

43 | Digital Wealth Managem ent in Asia Pacific

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 Hong Kong (SAR), China

Expanded market connectivity with Developed Payment-versus-Payment

mainland China (PvP), a settlement mechanism for FX
• Through the introduction of the Bond Connect transactions
schem e, Hong Kong provided a m ore convenient • In Hong Kong, six cross-currency PvP links have
and flexible channel for international investors to been established am ong the HK$, US$, EUR and
trade in the m ainland bond m arket using the RMB RTGS system s to im prove settlem ent
m arket infrastructure and financial services in efficiency and elim inate settlem ent risk arising
Hong Kong. from tim e lags in settlem ents and tim e zone
• In June 2020, the HKMA along with m ainland differences.
China authorities announced a new cross-
boundary Wealth Managem ent Connect pilot
schem e in the GBA, with the aim of providing Enhanced cyber resilience
access to the financial services of m ainland
• In Decem ber 2016, the HKMA launched the Cyber
Chinese banks in the GBA to Hong Kong residents
Security Fortification Initiative that includes cyber
and vice-versa.
resilience assessm ent and a cyber intelligence
inter-bank sharing platform , aim ing to im prove the
cyber resilience of authorised institutions,
Continue to promote competition and including m ajor retail banks, and selected global
develop private equity (PE) industry banks.
• The HKMA has been exploring ways to further
enhance the com petitiveness of Hong Kong’s
financial sector, particularly in the developm ent of
Hong Kong as an international asset m anagem ent
hub and regional destination for Corporate
Treasury Centres, green finance, and fund
investm ent activities.
• To prom ote the further developm ent of the PE
industry in Hong Kong, the HKMA plans to
continue to collaborate with the governm ent and
the industry to develop a m ore attractive
com petitive tax arrangem ent and to take forward
the legislative proposal of the lim ited partnership
regim e that would encourage m ore investm ent
funds and fund m anagers to set up and operate in
Hong Kong.

Digital Wealth Managem ent in Asia Pacific | 44

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 Hong Kong (SAR), China

Strong presence of large international banks, and growing competition

from FinTechs

Highly competitive landscape, with Growing competition from WealthTech

strong presence of international players
institutions Hong Kong has witnessed a steep rise in the num ber
Com petition within Hong Kong’s Banking sector has of FinTechs operating in the wealth m anagem ent
always been fierce, with a strong presence of leading space, driving transform ation in the existing industry
international banks — 71 of the world's 100 largest practices. Moreover, increased collaboration am ong
banks have a presence in the city.52 Also, within the the financial authorities and the FinTechs, and
wealth m anagem ent and private banking segm ents, creation of FinTech-friendly policies is further
their presence drives high degree of com petition. intensifying the com petitive environm ent.

The launch of virtual banking is likely to attract new WealthTech firm s operating in Hong Kong offer a
players which will further intensify the com petition. wide range of products which are easily accessible
via sm artphones. By leveraging algorithm s, they
With changing propositions and client needs, banks provide custom ers with m ost suitable investm ent
are increasingly evolving their business m odels by options based on their risk appetite and goals. Their
leveraging technologies and collaborating with objective is to narrow down the financial literacy
FinTechs, for instance: divide and enhance overall custom er experience, by
• DBS developed digiPortfolio, a hybrid hum an-robo utilising advance technologies for sm arter services.
solution, that enables custom ers to gain financial WealthTech firm s, such as Aqum on and LU
insights international are providing services focused m ainly on
• BoCHK collaborated with Magnum Research to the m ass m arket segm ent, while em erging FinTech
develop a robo-advisory platform firm s, such as Kristal.AI, focus on the upper m iddle-
class segm ent.

45 | Digital Wealth Managem ent in Asia Pacific

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 Hong Kong (SAR), China

Comparison of digital capabilities and offerings by leading players for HNW clients
In Hong Kong, both banks and platform -based wealth m anagers provide a wide range of digital capabilities to their
custom ers. Most of the banks provide digitised trade execution and client interaction capabilities, whereas WealthTechs
are well placed in providing robo-advisory services and portfolio recom m endations utilising Big Data analytics.

Digital capabilities HSBC SCB BOCHK JP Morgan Citi DBS BEA Aqumon Kristal.AI LUHK
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
Customer Features

research and insights ✔ ✔ ✔ ✔ ✔ ✔ ✔

Portfolio management ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔ ✔ ✔ ✔ ✔ ✔

Digital account opening ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Financial planning, analysis,
goal and investment tracking ✔ ✔

FX trading ✔ ✔ ✔ ✔ ✔ ✔
Digital execution

Equity trading ✔ ✔ ✔ ✔ ✔ ✔ ✔
Fixed Income trading ✔ ✔ ✔
Structured Product booking ✔ ✔
Funds (ETF) trading ✔ ✔ ✔ ✔ ✔ ✔
IPO subscription ✔ ✔ ✔ ✔ ✔
Robo-advisory ✔ ✔ ✔ ✔ ✔ ✔ ✔
solution
Internal

Big Data analytics ✔ ✔ ✔

Digital offering to facilitate
client interactions ✔ ✔ ✔ ✔ ✔

Leading traditional banks Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

Digital Wealth Managem ent in Asia Pacific | 46

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 Hong Kong (SAR), China

Banks can focus on partnering with FinTechs and launching their own
robo-advisory wealth solutions

Recommendations
Banks should focus on leveraging advanced data
driven technologies such as Big Data analytics and AI
for generating m odels to forecast future investm ent
growth and to provide real-tim e analysis for different
investm ents tailored to clients’ financial goals and risk
tolerances.

They can plan to expand their service of trading

equities for their clients across several international
stock m arkets.

Banks can also develop partnerships with FinTechs in

the wealth m anagem ent space and leverage robo-
advisory solutions to offer personalised financial
advice to clients.
They should also focus on tailoring their propositions
and digital channels to cater to the needs and
expectations of the younger generation of clients.

47 | Digital Wealth Managem ent in Asia Pacific

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 Hong Kong (SAR), China

Leading players and their digital

wealth management offerings

Leading traditional banks

HSBC Standard Chartered Bank (SCB)

Descrip tion Descrip tion

• Established in 1865, HSBC is the biggest • Incorporated in 2004; one of the three note-
incorporated bank in Hong Kong issuing banks in the region
• HSBC offers various digital capabilities to its • Hong Kong SCB Private Banking - one of the six
custom ers in Hong Kong and continues to leading centres; 50,000 new Priority clients in
enhance them , for instance: FY19
• In Septem ber 2020, launched HSBC • Continued m aking advancem ents in digitisation
VisionGo, a B2B digital com m unity platform
• In Septem ber 2020, launched a virtual bank
for SMEs, start-ups and prospective
‘Mox’ in Hong Kong
entrepreneurs, to support the banking needs
of Hong Kong business com m unity • Collaborated with the University of Hong Kong
to launch a ‘FinTech Academ y’
• Provides HSBC Smart Solutions, a digital
platform for businesses designed to help to
autom ate routine tasks, stream line workflow
and access tim ely data for better insights

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Provides HSBC Easy Invest app, that allows users • Launched real-tim e client on-boarding on digital
to trade securities and access m arket inform ation channels
including real-tim e quotes, news and m arket data
• Refreshed wealth and FX platform s with full
across stock m arkets of Hong Kong, m ainland
m obile access, Hong Kong transactions increased
China and the US; also allows to subscribe for
Stock IPO and option to view charts 15.0 percent year-on-year
• Launched ‘My RM’ function which allows clients
• Launched FlexInvest, a low-fee and easy-to-
to interact with their relationship m anagers and
understand service that allow users to start
gives them access to the latest m arket
investing in funds with just HK$100
inform ation; supports text chatting, docum ent
• Provides an online financial checkup tool, that sharing and audio calls
enable custom ers to access their financial
• Provides ‘SC Mob ile’ platform with several
situation, plan and achieve financial goals
em bedded capabilities including
• Provides Wealth Portfolio Intelligence Service,
that allows custom ers to effectively adjust their • Custom er Investm ent Profile: To create risk
profile
investm ent strategies and control risk with the
help of financial advisers • Mutual Fund: To execute Unit Trust order,
review portfolio returns and com pare fund
perform ance
• Equities: To view m ajor m arket indices,
m aintain stocks watch list, and buy and sell
Hong Kong stocks
• Foreign currency trading: 24/7 trading platform
with real tim e FX rates

Digital Wealth Managem ent in Asia Pacific | 48

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 Hong Kong (SAR), China

Leading players and their digital

wealth management offerings

Leading traditional banks

Bank of China (Hong Kong) JP Morgan

Descrip tion Descrip tion

• Operational in Hong Kong for about 90 years

• Incorporated in 2001, has 190 branches, 280
autom ated banking centres, over 1,000 self- • Provides several digital platform s to assist its
service m achines, and e-channels clients across the spectrum of services
• First bank in Hong Kong to connect via API to • JP Morgan Access® Mobile allows clients to
eTradeConnect, a blockchain-based trade finance view account inform ation
platform facilitated by the HKMA
• Chase Mob ile® ap p allows users to access
• First bank to launch a pilot m ainland personal their accounts, schedule/approve paym ents,
account opening attestation service for Hong Kong add/entitle users.
residents, facilitating the linking of m obile apps in
• JP Morgan's eXecute is a FX and com m odities
m ainland China for digital paym ent
trading app for institutional clients
• Form ed a joint venture with JD Digits and Jardine
Matheson to establish a virtual bank — Livi VB
Limited

Digital offerings in wealth management and

Digital offerings in wealth management and
p rivate b anking or for affluent clients
p rivate b anking or for affluent clients
• For private bank clients, created a dedicated
• Provides a wide array of investm ent services
mob ile ap p which allows access to real-tim e
through internet banking, including securities
financial position and perform ance of the portfolio,
trading, m onthly stocks savings, fund trading,
account m anagem ent, investm ent insights and
bond trading and precious Metals / FX m argin
analysis
trading, notional precious m etals trading,
investm ent deposit, structured investm ents, debt • Launched a robo-advisory investing service called
securities and eIPO application You Invest Portfolios; assists users to invest into
a portfolio m ade up of the bank’s ETFs
• Launched ‘BOC Remittance Plus’ a dual-
direction rem ittance service that facilitates • Offers several other platform s for wealth
cross-border fund transfer m anagem ent clients, including
• Also, provides Interactive 24/7 online chat • JP Morgan Markets, gives clients access to
service research and analytics, and real-tim e m arket
updates
• Provides a mob ile p latform that facilitates
trading, provides stock screener, free-of-charge • DataQuery allows retrieving, analysing and
Price alerts; supports corporate action and IPO charting historical data
subscription
• Partnered with Hong Kong-based Magnum
Research to provide robo-advisory services
• Partnered with Schroder Investm ent
Managem ent to launch ‘Asset Allocation
Reference Portfolio’ facilitating custom ers to
diversify risk and achieve long-term investm ent
goals

49 | Digital Wealth Managem ent in Asia Pacific

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 Hong Kong (SAR), China

Leading players and their digital

wealth management offerings

Leading traditional banks

Citi DBS

Descrip tion Descrip tion

• Operational in Hong Kong since 1902 and serves • Leading financial services group in Asia with a
m ore than one m illion clients presence in 18 m arkets; recognised as the ‘best
bank’ by Eurom oney, The Banker and Global
• Continued to introduce digital services, including
Finance
Citi Accelerate Savings® , a digital high-yield
savings account, and Citi ElevateSM Checking, a • Continued to build on its digital capabilities
digital high-yield checking account
• Launched DBS Home360, the first banking
• Digital deposit sales reached US$6 billion in 2019 m ortgage app in Hong Kong to leverage the
power of virtual reality
• Announced plans to explore providing checking
accounts to consum ers through Google Pay in • Launched a digital financial planning tool,
2020 which has about 1.8 m illion custom ers and
300,000 active m onthly users as at FY19.
• Continued to enhance wealth m anagem ent
capabilities by investing in offerings and digital • Also launched DBS MAX, an instant paym ent
tools to m eet a wider spectrum of custom er needs collection solution for m erchants
• Through Citi Priority, it serves the needs of
em erging affluent clients. With Citigold and
Citigold Private Client, it provides institutional-
grade, personalised wealth m anagem ent
services

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Provides Citi Mob ile® app that offers a wide range • Provides a dedicated platform to wealth
of capabilities to custom ers including trading in m anagem ent clients, DBS iWealth® , which
Hong Kong stocks, foreign exchange order allows users to trade equities across seven
watching services and provides insights into international stock m arkets and 14 currencies
m arket opportunities and investm ent decisions. It 24/7, to m onitor banking, trading and wealth
has also em bedded several new features to portfolios; also provides users with research and
enhance overall experience such as: insights, and price alerts relevant to one’s
investm ent portfolio
• Citi® Portfolio Selection: Allows custom ers to
build a portfolio with expert advice, review • Launched the first fully virtual wealth
returns and trade funds 24/7 management account op ening solution;
leverages advanced technologies, including instant
• Move Money to Citi: Facilitates real-tim e
identity verification, biom etric recognition, and
m oney transfer from accounts at other banks to
state-of-the-art digital security
Citi to support increased client need for wealth
m anagem ent • Allows custom ers to set up a m ulticurrency
savings and wealth m anagem ent account
• Citi Live Chat: Enables the bank’s relationship
com pletely online
m anagers to interact with their Private Banking
and Citigold Clients, without needing third-party • Launched DBS digiPortfolio, hybrid hum an-robo
platform s solution, enabling consum er banking custom ers to
gain financial expertise and investm ent
• Launched robo-advisory (Robo 360), co-developed
opportunities usually lim ited to wealth clients
with FinTech firm Quantifeed; can be accessed
using m obile banking app and enables investors to
access portfolios, constructed with up to eight
funds by leveraging sm art analytics and
quantitative research capabilities

Digital Wealth Managem ent in Asia Pacific | 50

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 Hong Kong (SAR), China

Leading players and their digital

wealth management offerings

Leading traditional banks

Bank of East Asia (BEA)

Descrip tion Digital offerings in wealth management and

p rivate b anking or for affluent clients
• Incorporated in 1918; a leading Hong Kong based
financial services group. • Continued developm ent of a m ore personalised,
com prehensive and user-friendly digital platform
• Digital custom er penetration reached 50 percent
to enhance interaction with high-net-worth clients
and about 80 percent of financial transactions are
m ade via autom ated channels • Added a client version of portfolio m anagem ent
application to BEA App
• In January 2020, established a Digital and
Innovation Office to enhance data analytics • Widened the range of wealth product offerings via
capabilities, strengthen insights into custom er m obile app such as unit trusts, linked deposits and
behaviour, and build FinTech solutions short-term life insurance
• Refreshed it official BEA app, following which its • BEA Securities ap p provides trading and
users grew by about 37 percent investm ents services with real-tim e m arket
stream ing charts

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 Hong Kong (SAR), China

Leading players and their digital

wealth management offerings

Leading wealth management platforms

Aqumon Kristal.AI LU International

(Hong Kong)
• AQUMON, an algorithm - • Online investm ent platform
driven investm ent platform that focuses on providing • Subsidiary of Lufax Holding
developed by Magnum personalised products and and backed by Ping An
Research, provides advice to its clients; Insurance Group, has
autom ated, algorithm -based functions on a hybrid m odel launched LU HK m obile
and custom ised global asset that leverages advanced application, its second
allocation services through algorithm s and investm ent overseas venture after
cloud com puting technology professionals’ strategies to Singapore
and aim s to bring a assist users to invest in a
revolutionary change in the variety of financial products • Collaborated with leading
investm ent approach (private equity, pre-IPO global asset m anagers,
deals, VC funds & other offers wide range of HK$-
• Targets to provide affordable based m utual fund products
investm ents including
access to proper wealth on the application across
bitcoin, gold, hedge funds,
m anagem ent capabilities to m ajor m arkets and asset
etc.) and select the
about seven m illion m iddle classes; also has em bedded
investm ent portfolio that
class people residing in a feature that provides users
suits their return-risk
Hong Kong with latest m arket updates
preference
• Partnered with about 60 and investm ent opinions
• Gained a significant m arket-
financial institutional, • Allows custom ers to open
share in Hong Kong and
including China AMC, BOCI accounts online within three
Singapore, as well and as in
and CMB Wing Lung Bank m inutes with clear
a few Indian states, focused
• Com pleted A round of on scaling geographically in instructions from online AI-
funding and raised about other Asia Pacific regions enabled custom er services;
US$11 m illion from several with differentiated offerings leverages a variety of
investors including Hong financial technologies to
• Raised US$11 m illion m ake the entire investm ent
Kong University of Science
funding in Series A round, process personalised and
and Technology, Alibaba
with about US6 m illion secure, including investm ent
Entrepreneurs Fund and
funding raised from Chiratae preference questionnaires to
Bank of China International
Ventures (form erly IDG determ ine risk appetite and
affiliate
Ventures India), and Desai Big Data analysis for m aking
Fam ily Office fund recom m endations

Digital Wealth Managem ent in Asia Pacific | 52

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 Mainland China

53 | Digital Wealth Managem ent in Asia Pacific

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 Mainland China

One of the biggest internet markets, seeing a large-scale shift to digital

payments and mobile banking

Large and growing mobile and internet population

Although the internet penetration rate in m ainland China is lower than several key European m arkets, its total num ber is
significantly higher and continues to rise. With rapid urbanisation and a high rate of m obile phone penetration, the
% m arket is experiencing a strong growth in the adoption of online and m obile banking services.

78%
Mainland Chinese
59%
Internet penetration in mainland
customers use China, with a total of 854.5 million
mobile banking* to internet users54
interact with their >99% of internet users surf the
banks5 3 internet via mobile phones55

Note(s): *Latest data available for 2018

Digital Wealth Managem ent in Asia Pacific | 54

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 Mainland China

Shift to online payments and digital Tech firms dominating the

wallets payments landscape
The robust growth of sm artphone adoption in This transform ation has seen the rise of two
m ainland China has created am ple opportunities m ajor digital paym ent platform s, Alipay and
for the digital paym ents system to develop at a WeChat Pay, subsidiaries of two of m ainland
rapid pace. Taking advantage of this, m ainland China’s largest Technology firm s, Alibaba and
China has been able to com pletely transform its Tencent, respectively.
paym ents landscape, with digital wallets and
• Both the platform s have a substantially large
QR codes quickly replacing the card-based
base of active users, with Alipay reaching
system .
1.2 billion m onthly users in 2019 while
WeChat Pay surpassed the one billion user
Total transaction value m ark.58
in digital payments

$2.3T projected by 2020 —

the highest
of all mobile payments
are made over two
transaction value
across all markets5 6 92% platforms — Alipay
(53%) and WeChat
Pay (39%)5 9

Mobile point of sale

$1.1T payments projected
by 20205 7
of people in mainland
China’s largest cities
use WeChat Pay and
>90% Alipay as their primary
payment method,
followed by cash and
debit/credit cards60

As a result of their dom inance, banks have

gradually been sidelined in the paym ents space
and a m ajority of their share of being the
interm ediary for paym ents has been acquired
by these large technology players.

55 | Digital Wealth Managem ent in Asia Pacific

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 Mainland China

Growing upper middle-class population driving the demand for online

wealth management products

Home to a large and growing HNW Affluent middle class driving the
population demand for online wealth
Mainland China recently replaced Japan to becom e the management products
m arket with the second largest num ber of HNWIs, Mainland China has a large and growing m iddle-
accounting for m ore than a third of all m illionaires in and upper m iddle-class population, which
Asia Pacific.61 Further, it is expected to give rise to a currently represents m ore than half of the
significantly higher num ber of HNWIs in the com ing five m arket’s online wealth m anagem ent clients.
years. With rapid urbanisation in recent years, m ore
than 60% of m ainland China’s population now
lives in urban areas.65 As per a report published
People with net worth by Marco Polo, m ainland China’s m iddle-class
population is expected to reach 650 m illion by
over US$1 million
7.3M (including their primary
residence), the largest
2025.66

Mainland China affluent p op ulation growth

HNW population in Asia (in millions), 2016–2067
Pacific6 2
45.95
Growth expected in
58%
42.20
mainland China’s HNWIs 3 8.71
during 2019–24 to reach 3 3 .52
3 4.43
11.6 million6 3

However, although m ainland China is creating a large

num ber of HNWIs every year, it is also witnessing a lot 2016 2017 2018 2019e 2020e
of wealth m igration, as these m illionaires m ove away
to developed English-speaking dem ocratic m arkets Source: GlobalData analysis
with better education and healthcare system s as well
as due to insecurities from the current totalitarian In the past, providing services to these
governm ent. custom ers with traditional, non-digital m ethods
was very costly. However, with technology
advancem ents and availability of sm art channels
that offer personalised services in a cost-

15,000 effective way, the dem and for online wealth

m anagem ent products is growing. This
expansion of the m iddle class is further
expected to bring significant opportunities for
Mainland Chinese HNWIs migrated to other digital wealth m anagers.
markets in 2018, the largest HNWI migration
from any market6 4
Rise in investing activity from
youngsters
There has been an increase in investing activity
from a greater num ber of younger clients using
sm artphones.
• According to a recent survey, in 2018, 36.5
percent of retail m utual fund investors in
m ainland China were less than 30 years old,
of which 71 percent used m obile devices as
their m ain investm ent tool.68

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 Mainland China

Traditional banks, FinTech players

and tech giants are accelerating
the adoption of WealthTech

Growth in online wealth management

platforms, products and services
Hom e to a large affluent population with high online
banking adoption, m ainland China has seen a rapid
growth in internet financing platform s as well as in the
use of sm art technologies by traditional financial
institutions.
Digital wealth m anagem ent offerings, including robo-
advisory services and funds distribution through m obile Big Data enables robust risk
devices, continue to penetrate the m arket.
management and smarter asset
The growth in m ainland China’s digital wealth
allocation
m anagem ent m arket can be attributed to the low cost
and convenient access to a wide variety of high-yield Digital wealth m anagers are using Big Data
fixed-incom e products offered by the em erging online analytics to provide low-cost solutions that are
wealth m anagem ent platform s. free from any bias present in the traditional
Also, digital paym ent service providers are bolstering practices. These new solutions use sm art
their position in m ainland China’s wealth m anagem ent technologies to m atch the evolving needs of
space with the focus on expanding into the m ass m arket, clients as well as to im prove capabilities across
for instance: the investm ent cycle (including risk m onitoring,
contingency planning and ensuring com pliance).
• WeChat Pay offers its own wealth m anagem ent
platform and recently launched a m oney m arket fund Adoption of Big Data is also helping wealth
that allow users to earn interest from their WeChat m anagers to im prove several other key stages
Pay balance. in the value chain such as client acquisition,
investm ent planning and portfolio m anagem ent.
OneConnect — a subsidiary of Ping An and a
Increased adoption of technology by technology-as-a-service platform for financial
traditional players to improve customer institutions — provides wealth m anagers a
experience com plete portfolio m anagem ent solution that
covers all aspects of the wealth m anagem ent
Leading traditional players in m ainland China are actively
value chain, including m arket inform ation,
investing in advanced technologies such as AI, m achine
learning and Big Data to transform their entire wealth trading, valuation, portfolio and risk
m anagem ent value chain for higher efficiency and to m anagem ent.
provide im proved custom er experience that is superior to
what legacy m odels offer.
• Lufax, Ping An’s wealth m anagem ent platform , uses
Big Data, m achine learning and data-driven COVID-19 further accelerates
technologies to analyse investors’ profiles and risk digital adoption in mainland China
appetites to offer tailored products.
With increased reliance on the internet by
• CMB offers Machine Gene Investm ent, a Big Data- clients isolated at hom e to m ake investm ent
based m obile robo-advisory that com bines the decisions, COVID-19 has accelerated the
experience of financial advisors with m achine-learning digital disruption in m ainland China and is
algorithm s. likely to have a long-term im pact on wealth
m anagem ent.
It has acted as a catalyst to the growth of
digital channels, leading to a rise in the
num ber of third-party online platform s and
traditional banks enhancing their digital
com petencies.
• Several banks have now started providing
their com plete range of services to
custom ers rem otely.
• 50+ asset m anagers and investm ent firm s
have built wealth accounts on the Ant
Fortune app (the wealth m anagem ent
platform of Ant Financial).69
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 Mainland China

Government bringing strong policies to tighten control over FS

practices in mainland China

In the recent years, mainland Chinese regulators have been strengthening their oversight of over
the FS industry, with new regulations related to risky wealth management products, online
lending, data privacy as well as outbound investments. Compliance for these is expected to result
in higher costs for the banks and wealth managers as well as require higher focus and effort.

New asset management rules New online lending rules

In 2018, m ainland China announced new asset In June 2020, m ainland China's Banking and Insurance
m anagem ent rules seeking to curb shadow banking in Regulatory Com m ission announced new online lending
the m arket, a core part of which are wealth rules to reduce regulatory risk concerns resulting from
m anagem ent products (WMPs). The new rules third-party cooperation. The new rules include:
rem ove im plicit guarantees offered by the lenders on
• stricter qualification, risk and data protection
these WMPs, set stricter investm ent norm s and
requirem ents from third parties
standardise the m anagem ent of fund pools.
• increased inform ation disclosures to borrowers
• However, these rules have been pushed back by a
year to help financial institutions transition am id • restrictions on use of online loan funds for
the COVID-19 pandem ic and are expected to investm ent in property, stocks, bonds, futures,
conclude by the end of 2021. derivatives, etc.
• Moreover, the rules are pushing lenders in
m ainland China towards establishing their own Cybersecurity and personal data
wealth m anagem ent subsidiaries, as these protection
subsidiaries are allowed to invest directly in
stocks, thereby increasing the volum e of new In March 2020, m ainland Chinese regulators published
funds into the stock m arket. a new set of Personal Inform ation (PI) Security
Specifications to strengthen data privacy protection in
the m arket.
Tightened regulations on FinTechs The specifications cover a wide range of data issues
and include guidelines that focus on user’s consent on
Since 2017, regulators have been tightening control
data sharing, data use lim itations, user’s right to correct
on different aspects of FinTechs, including:
data and request for data rem oval.
• lim iting asset-backed securitisation
• creating a central paym ent clearing system , Outbound investments
NetUnion
Mainland Chinese authorities have been strengthening
• restraining the use of proprietary credit scores their control over outbound investm ents to protect
m ainland China’s forex reserves (dropping since 2014)
• requiring third-party paym ent services (e.g., Alipay)
and RMB devaluation, and to curb m oney laundering by
to deposit 100 percent client reserve funds with
dom estic enterprises.
the People’s Bank of China
In 2016, People’s Bank of China announced enhanced
supervision over foreign exchanges and cross-border
RMB paym ents. In 2018, it enhanced its supervision
on outbound investm ent projects worth US$300+
m illion or those in ‘sensitive m arkets or industries’.70

Digital Wealth Managem ent in Asia Pacific | 58

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 Mainland China

Initiatives to support digital banking and cross-border wealth

management

As part of its plans to open up the FS industry, the mainland Chinese government has introduced
new rules supporting digital banking licences, relaxations on cross-border investments as well as
the initiative to facilitate smoother investing activity in the Guangdong-Hong Kong-Macao Greater
Bay Area (GBA), with a strong focus on attracting foreign investors as well as FS players into the
market.

Step towards digital-only banking New forex rules to ease cross-border

licences transactions
In January 2020, m ainland China announced it is In October 2019, m ainland China’s State
finalising its first rules to cover online-only banking Adm inistration of Foreign Exchange introduced 12
operations in the m arket, in a push to attract foreign new m easures to relax controls on cross-border
players including existing foreign lenders — HSBC, transaction and investm ent requirem ents, aim ing to
Citi and SCB — and em power them to establish provide a better environm ent for dom estic
independent online banks. businesses and overseas investors.
• Since 2014, m ainland China has licensed only four Som e of the key m easures include:
digital-only banks — WeBank (backed by Tencent);
MYbank (Alibaba); AiBank (Baidu); and China Citic Offering more flexib ility to
Bank.71 foreign investors by rem oving
restrictions on dom estic equity
investm ent of capital fund of
foreign investm ent enterprises

Relaxing docum ent requirem ents

before forex settlem ent, to
reduce p rocessing time of the
transactions between dom estic
firm s and foreign investors

Expanding the pilot schem e to

six free trade zones (FTZs),
raising m ainland China’s FTZs
from 12 to 18, as well as the
entire Shanghai jurisdiction

Extending dom estic credit assets

transfer to foreign investors, allowing
them to carry out cross-border
transfers of m ainland China’s non-
perform ing assets using foreign
capital

59 | Digital Wealth Managem ent in Asia Pacific

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 Mainland China

Wealth Management Connect to

facilitate capital flow in the GBA
In June 2020, m ainland China, Hong Kong and Macau
jointly introduced the cross-boundary Wealth
Managem ent Connect pilot schem e in the GBA,
allowing its residents to invest in wealth m anagem ent
products (WMPs) distributed by banks in the region.
The schem e aim s to facilitate the flow of capital in
the GBA, which is hom e to ~480,000 HNWIs,
offering an expanded investor base to financial
institutions.72 It will also provide investors with
greater product diversity and asset allocation options.

The cross-boundary rem ittance will be carried out in

RMB, allowing investors from m ainland Chinese cities
in the GBA to directly use RMB to invest in WMPs
offered by banks in Hong Kong and Macao, and vice
versa.

Wealth Managem ent Connect is expected to attract

m ore foreign players to set up or expand their
presence in the GBA and spur com petition in the
region. This will drive greater product innovation and
raise the bar of product design, service quality and
risk m anagem ent.

Digital Wealth Managem ent in Asia Pacific | 60

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 Mainland China

Stronghold of large domestic banks, although growing competition

from tech and foreign players

Mainland Chinese banks lead the wealth In Decem ber 2019, the first foreign m ajority-owned
management space wealth m anagem ent firm was approved in m ainland
China, paving the way for m ore foreign players in the
Mainland China dom inates the global Banking future.
industry, with its Big Four banks — ICBC, CCB,
Agricultural Bank of China and BoC — holding top
positions and US$14.8 trillion in Banking assets.73
Growing competition from tech players
These banks, along with other large dom estic players,
Large technology firm s and FinTech players have also
also dom inate the wealth m anagem ent and private
been entering the m arket and transform ing existing
banking segm ents in the m arket. They have a strong
wealth m anagem ent practices.
focus on digitalisation as well as collaborating with
technology firm s in this dom ain. Mainland China has established itself as a leader in
the WealthTech space, with a larger num ber of
• Using AI and m achine learning, offering robo-
WealthTech firm s operating in the m arket and
advisory services and creating interactive
offering access to a wide range of products that are
program m es that give personalised financial
highly tailored and seam lessly integrated onto the
advice are som e of the com m on developm ents in
sm artphones. Their focus is on custom er experience,
this segm ent.
com bined with the utilisation of Big Data for sm arter
As a result, dom estic banks are placed further ahead services.
of their foreign peers when it com es to providing
Large technology firm s, such as Ant Financial and
digital wealth m anagem ent services to custom ers.
Tencent, are providing services focused m ainly on the
However, with the opening up of m ainland China’s FS m ass m arket segm ent, while em erging FinTech
sector, foreign wealth m anagers are also entering the firm s, such as Lufax, focus on the upper m iddle-class
m arket. segm ent.

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 Mainland China

Comparison of digital capabilities and offerings by leading players for HNW clients
In m ainland China, banks and platform -based wealth m anagers offer various digital capabilities. Traditional banks are
well positioned to provide digitised trade execution capabilities. However, in term s of delivering personalised portfolio
recom m endations, WealthTechs are further ahead of traditional banks, as a m ajority of them provide investm ent
recom m endations based on investors’ risk appetite.

Ant
Digital capabilities BOC CMB ICBC CCB HSBC SCB Noah Credit Ease Jinfuzi Lufax
Fortune
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
Customer Features

research and insights ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Portfolio management ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Digital account opening ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Financial planning, analysis,
goal and investment tracking ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

FX trading ✔ ✔ ✔ ✔ ✔ ✔
Digital execution

Equity trading
Fixed Income trading ✔ ✔ ✔ ✔
Structured Product booking ✔ ✔ ✔ ✔ ✔
Funds (ETF) trading ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
IPO subscription
Robo-advisory ✔ ✔ ✔ ✔ ✔
solution
Internal

Big Data analytics ✔

Digital offering to facilitate
client interactions ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Leading traditional banks Leading wealth m anagers Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

Digital Wealth Managem ent in Asia Pacific | 62

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 Mainland China

Banks must aim to grow market share by developing innovative

offerings and FinTech partnerships

Recommendations
Banks should continue to invest in technology and
wealth capabilities by launching new digital products
and services that target m ass affluent and HNW
clients in the m arket.

They can collaborate with em erging FinTechs in the

wealth space and provide dedicated wealth
m anagem ent platform s powered by robo-advisory to
offer personalised financial advice to their clients.

Banks should also focus on strengthening their

presence and offerings in the GBA with increased
access to the region’s wealthier population with the
progress of the new Wealth Managem ent Connect
pilot schem e.

63 | Digital Wealth Managem ent in Asia Pacific

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 Mainland China

Leading players and their digital

wealth management offerings

Leading traditional banks

Bank of China (BOC) China Merchants Bank (CMB)

Descrip tion Descrip tion

• One of the four largest banks (by assets) in • One of the leading com m ercial banks in m ainland
m ainland China, with strong focus on adopting China
new technologies such as 5G, Internet of Things,
• ~114 m illion of the bank’s custom ers use CMB
blockchain and virtual reality
App who undertook wealth m anagem ent
• ~181 m illion of the bank’s custom ers use ‘BOC transactions am ounting to RMB7.87 trillion in
Mobile’ that uses Version 6.0 of m obile banking FY19, accounting for 71.52 percent of the bank’s
total wealth m anagem ent transactions
• Its subsidiary BOC wealth m anagem ent form ed
the first asset m anagem ent (AM) JV with Am undi, • Developed intelligent risk control platform known
a European AM com pany as the “Libra System ”, that enables counterfeit
detection and interception of telecom frauds
• Launched the “Cross-border Wallet” paym ent
service for Macau residents • Intercepted 80,000 telecom fraud transactions
of ~ RMB1.8 billion till now, providing strong
protection of the custom ers’ capital

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Through BOC’s web platform and m obile • Offers Machine Gene Investment, a Big Data-
application, custom ers can avail various based m obile robo-advisory service that com bines
investm ent services including securities trading, the strengths and experience of hum an financial
m onthly stocks savings, fund trading, bond trading advisors with m achine-learning algorithm s to
and precious m etals / FX m argin trading provide services to the clients
• Constructed a m arket-wide product selection • Optim ises ‘intelligent portfolio allocation
platform to enhance its asset allocation capacity services (PAS)’ based on the m utual funds and
global asset allocation, and provides real-tim e
• Launched “Greater Bay Area Service Connect”
calculation of investm ent portfolios
service to provide m utual service access to wealth
m anagem ent custom ers • Bank’s internet banking system allow users to
perform investm ent operations such as
• Intensified FinTech ap p lication and developed
purchases, subscriptions
featured intelligent autom atic investm ent
strategies in order to im prove its integrated and • Provides Risk Tolerance Assessm ent system , that
intelligent investm ent product sales capabilities analyses investors risk appetite and recom m ends
investm ent products
• Introduced BOC Rob ot Advisor p rogramme,
an intelligent service portfolio, which recorded • Also provides surplus fund investm ent service, via
a transaction volum e of RMB12.3 billion and its e-banking platform
attracted over 100,000 custom ers

Digital Wealth Managem ent in Asia Pacific | 64

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 Mainland China

Leading players and their digital

wealth management offerings

Leading traditional banks

Industrial and Commercial Bank of China China Construction Bank (CCB)

Ltd. (ICBC)
Descrip tion
Descrip tion • One of the four largest banks (by assets) in
• World’s largest bank in term s of assets m ainland China with ~351 m illion of custom ers
that uses m obile banking
• ~361 m illion of the bank’s custom ers use ‘ICBC
Mobile’ that uses Version 5.0 of m obile banking • Launched BCTrade2.0 — a new platform that
leverages blockchain technology to provide better
• Launched cross-border bill paym ent service, and financial services to m ainland Chinese exporters
rolled out financial ecosphere cloud services, that — under its subsidiary Jianxin Financial Services
provide services such as personnel inform ation
m anagem ent, bill m anagem ent and fund • Launched a wholly owned wealth m anagem ent
settlem ent subsidiary CCB Wealth Managem ent

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients

• ICBC m obile banking application and WeChat • Offers m obile version of ‘CCB e-private banking’
b anking, allow custom ers to buy, redeem , cancel • Launched its ‘FITS e+’ investor alliance platform
financial products, as well as view the products
held and access transaction details • ‘Long Fortune’, a FinTech-based wealth
m anagem ent service platform designed to deliver
• Also facilitates trade in precious m etals and asset structuring, AI-assisted investm ent advisory,
currency retail loans, liquidity m anagem ent and AI-assisted
• Provides ICBC Smart Invest Ap p that allows insurance advisory services
securities trading in Hong Kong stocks, Shanghai • Offers FX trading and securities services
stocks, US stocks and IPOs through its online banking platform
• Launched rob o-advisory service for wealth
m anagem ent products
• Partnered with Pintec to leverage its technical
capabilities in Big Data, AI, and robotic process
autom ation (RPA) for digital banking and wealth
m anagem ent

65 | Digital Wealth Managem ent in Asia Pacific

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 Mainland China

Leading players and their digital

wealth management offerings

Leading traditional banks

HSBC Standard Chartered Bank (SCB)

Descrip tion Descrip tion

• HSBC in m ainland China was incorporated in April • One of the oldest and largest foreign banks in
2007, is one of the largest investors am ong m ainland China
foreign banks
• Offers m obile banking, online banking, video
• Offers m obile banking, online banking, WeChat banking and SMS banking services to its
service account and telephone banking services to custom ers
its custom ers
• Introduced new Online Banking functions
• Planning to hire about three thousand wealth including FX Service, Global Link Service, Fixed
planners in m ainland China Deposit/Call Deposit 2.0 Application Service
• In April 2020, launched digital account opening • Priority Private offers a suite of personalised
service, first am ong foreign banks to launch such wealth solutions with exclusive privileges to
service affluent clients
• Introduced Prem ium Banking service to serve
em erging affluent clients
• Launched Straight2Bank onboarding portal for
digital account opening
Digital offerings in wealth management and
• Plans to set up a brokerage firm in m ainland China
p rivate b anking or for affluent clients
• Provides online and m obile application-based
wealth m anagem ent platform that enables users
to know their financial health, supports dual Digital offerings in wealth management and
currency m obile trading, m utual fund trading, p rivate b anking or for affluent clients
structured products and view/update risk profile.
• Strengthened its FX electronic trading capability
• Provides an online financial checkup tool, that through m em bership with China Foreign
enables custom ers to access their financial Exchange Trade System (CFETS), an inter-bank
situation, plan and achieve financial goals foreign exchange trading service portal in
m ainland China
• Has a dedicated web-based channel — Wealth
Insights, that provides industry wide research and • Allows online purchase of m arket linked financial
expert onions products
• Has announced it will launch m obile-based wealth • Client investm ent profile helps users to better
advisory service, and hire about 100 team understand their investm ent objectives and
m em bers for the sam e update their risk profile

Digital Wealth Managem ent in Asia Pacific | 66

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 Mainland China

Leading players and their digital

wealth management offerings

Leading wealth managers

Noah Holdings Ltd.

Descrip tion Digital offerings in wealth management and

p rivate b anking or for affluent clients
• A leading wealth and asset m anagem ent service
provider in m ainland China • Built a global ‘Gop her’ platform to identify and
source non RMB-denom inated financial products
• Its core client application ‘Wei Nuo Ya’ (“m icro
for onshore and offshore m ainland Chinese high
Noah”) — an effective com m unity m anagem ent
net worth clients
portal and investor education tool — provides
personalised industry news and research, live • Launched an online m utual fund transaction
broadcasts on expert discussions and product platform , ‘Fund Smile’ (form er Cai Fu Pai) that
roadshows serves m ass affluent individuals in m ainland China
• Plans to leverage robo-advisory and Big Data in • Developed a new online financial advisory
wealth m anagem ent platform called ‘Pilot Whale’ that aim s to connect
investors to financial experts including licensed
relationship m anagers and provide independent
and professional paid services
• Leverage m ultiple online channels including social
networks such as WeChat, dedicated m obile
applications and web-based services to prom ote
better engagem ent of wealth m anagers and
clients

67 | Digital Wealth Managem ent in Asia Pacific

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 Mainland China

Leading players and their digital

wealth management offerings

Leading wealth management platforms

CreditEase Wealth Management Ant Fortune

• Wealth m anagem ent arm of CreditEase, which • An online wealth m anagem ent platform and an
focuses on providing com prehensive global asset affiliate of Ant Group — world’s highest-valued
allocation services to HNWIs and m ass affluent FinTech that offers several services including e-
m ainland Chinese investors wallet, online lending and investm ent fund — that
collaborates with financial institutions, such as
• Uses an online-offline m odel and has ~2,000
fund m anagem ent and insurance com panies and
relationship m anagers throughout the m arket,
leverages its AI-powered capability to offer tailor-
who provide personalised service
m ade wealth m anagem ent services
• Mass-m arket option uses an online platform ,
• In 2018, Ant Group launched a m oney m arket
where users select from a range of standardised
fund — Yu’E Bao, allowing custom ers to park
investm ent options, asset allocation m odels and
cash in their Alipay accounts into liquid assets,
portfolio risk controls
the fund grew to becam e one of the largest
• Offers a wide range of services such as m oney m arket funds in the world in 2019
investm ent im m igration and international
• Platform 's algorithm recom m ends funds based on
education advisory, and products across different
each user’s risk appetite, goals and investm ent
asset classes including fixed incom e, private
horizon, thereby reducing the financial literacy
equity, capital m arkets, real estate and insurance
divide that acts as an investm ent barrier for m any
• Toum i RA (robo-advisory provider) tracks stock, individuals
bond and real estate m arket indexes globally to
optim ise cross-border and m ulti-class asset
allocation for global ETF portfolios and therefore
bring investors higher risk tolerance and stable
yield regardless of individual m arket or political
turbulence.

Lufax Holdings Jinfuzi

• One of m ainland China's largest online wealth • An online investm ent platform that allows users to
m anagem ent platform s backed by Ping An invest in a variety of financial products (private
Insurance Group, that provides alm ost 7,800 equity, trust, foreign funds etc.) through the
diverse products and custom ised services, that internet and also aim s to help investors to select
includes risk m anagem ent, financial assets trading the investm ent portfolio that suits their return-risk
inform ation and related consulting services, to preference
~12.5 m illion m iddle-class investors through the
• In April 2019, Jinfuzi raised US$25.6 m illion in a
platform LU.com
series-D round of financing led by the m arket’s
• Deployed algorithm ic sensors at key stages, such private equity firm Loyal Valley Capital
as account opening, product purchasing, and links
bank cards with accounts
• Established a content com m unity, and
recom m ends custom ised inform ation and advice
based on investm ent experience, transaction
habits, and the risk preferences of users;
dynam ically adjusts content according to the
browsing history of each user

Digital Wealth Managem ent in Asia Pacific | 68

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 India

69 | Digital Wealth Managem ent in Asia Pacific

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 India

Second-largest internet market, with large-scale shift to digital

payments and mobile banking

Large and growing mobile and internet population

India is the second largest online m arket in the world, ranked only behind m ainland China.74 Though the internet and
sm artphone penetration rates are lower than several leading countries, their absolute volum es are significantly higher
% and continue to grow rapidly. Moreover, availability of inexpensive internet data, better 4G accessibility and governm ent
initiatives are accelerating India’s pace to becom e m ore connected and digitised.

50%
Internet penetration recorded
32%
Smartphone
in January 2020, with a total of penetration in India,
687.6 million internet users75 with smartphone users
projected to reach 760
>97% of internet users access
million by 202177
internet via mobile phones76

Digital Wealth Managem ent in Asia Pacific | 70

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 India

Robust growth in digital payment Unified Payments Interface (UPI)

space making wallets obsolete
The increasing availability of sm artphones in the Since being launched in 2016, UPI (an instant
m arket, growing adoption of digital channels real-tim e paym ent system developed by
and governm ent’s financial inclusion efforts National Paym ents Corporation of India
have created vast room for the digital paym ents facilitating inter-bank transactions), has
system to grow at a rapid pace. Taking witnessed a steep rise in adoption as it links the
advantage of this, India has been able to bring paym ent platform directly with the custom er’s
significant advancem ent in its paym ents bank account, enabling direct account-to-
landscape. account transfers. It also rem oves the need to
store m oney in wallets, allowing for interest to
be earned.
Total transaction value
in digital payments This has led to m ore wallet operators to adopt

$74B projected by 2020 —

expected to grow at
CAGR of 16.7%
UPI as a paym ent m ethod. Moreover, in 2019
UPI surpassed debit and credit cards as a
preferred paym ent m ethod and accounted for
about 38 percent of all digital transactions.81
between 2020–2478
• Leading wallet operators, such as PhonePe
and Paytm , have started running a hybrid
m odel by adding UPI paym ent feature to
Mobile point of sale
$16.4B payments projected
by 202079
their e-wallet apps.

Moreover, the shift toward UPI has given banks

an access to low-cost retail deposits, which
would not have been possible with m oney
being stored in wallets.

• Digital paym ents in India are expected to

reach US$135.2 billion in 2023 and will UPI transactions were
account for about 2.2 percent of the world’s recorded in 2019,
digital paym ents m arket.80 This will be
further boosted by the adoption of digital
paym ent channels due to COVID-19.
5.4B projected to grow at
CAGR of 287% to
reach 59.8 billion by
20238 2

market share in India's

UPI ecosystem is

>90% controlled by three

operators — PhonePe,
Google Pay and
Paytm 8 3

In term s of transactions, PhonePe is the India’s

leading UPI service provider, followed by
Google Pay and Paytm . Apart from them , som e
of the Indian banks such as SBI, ICICI, HDFC
and Axis Bank also provide UPI paym ent service
platform s.

Total b usiness users (in millions) 84

Paytm
16

10 Google Pay
8
PhonePe

71 | Digital Wealth Managem ent in Asia Pacific Source: Com pany disclosures; Reserve Bank of India, S&P
Global Market Intelligence analysis
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 India

Growing UHNW population driving the demand for wealth

management products

Home of growing UHNWI population Evolving wealth management and

According to the Knight Frank Wealth Report 2020, lending landscape
India is ranked 12th globally in term s of UHNWI India’s wealth m anagem ent industry is in its
population with 5,986 individuals in the category.85 The form ative state of digitisation, with m ultiple
num ber is expected to grow to 10,354 individuals in new age solutions being launched by various
the next five years.86 players.
• India’s HNWI population is expected to grow to 0.5 FinTech firm s are disrupting the industry by
m illion by 2024 from 0.3 m illion in 2019.87 providing access to tailored advice, non-
• Meanwhile, the num ber of billionaires is projected traditional investm ent and advanced
to increase to 113 by 2024, from 104 in 2019.88 engagem ent solutions. Also, som e are offering
wealth m anagem ent services on a subscription-
based m odel.
People with US$30+ To keep up with em erging players, traditional
million net worth,
~6K
firm s are focusing on leveraging technologies to
12th largest UHNWI im prove client experience and stream line
population in the processes.
world8 9 • IDFC introduced a portfolio m anagem ent
system that leverages AI and Big Data to
identify investm ent opportunities.

Growth expected in • ICICI and DSP have com e up with a draft

73% India's UHNWI offer for their quant-based m utual fund

schem es that follows a data-driven approach
population during for stock selection, through which the m odel
2019–249 0 autom atically selects stocks with lim ited
hum an intervention.
• ICICI Bank launched ‘Money Coach’, an
algorithm -driven investm ent advisory
Although India had the fastest growing HNWI application that enhances overall custom er
population in 2017, witnessing a 20 percent y-o-y experience, from enrolm ent into a m utual
growth, it failed to m ake any key net additions since fund to actual investm ent and liquidation.
then, reporting a 3 percent drop in 2018 and a roughly
Also, firm s like Edelweiss and IIFL have
equal growth in 2019, keeping the HNWI population
introduced subscription-based wealth
growth stagnant.91
m anagem ent platform s.
Moreover, India is witnessing considerable wealth
India’s lending landscape is undergoing a
m igration, as m any of its m illionaires have been m oving
substantial change as digital lenders are getting
away to developed countries with better education and
significant traction, that is well supported by a
healthcare system s as well as due to a higher tax rate
large and growing m obile and internet
currently prevalent.
population.
• In 2018, digital lending in the m arket stood
at about US$75 billion, which is expected to

23,000
reach US$350 billion by 2023.93
• According to MEDICI, in 2019 there were
~338 digital lending platform s operating in
the m arket which is expected to grow
India's HNWIs migrated to other further.94 Also, few of the leading tech
countries between 2014-1892 com panies such as Am azon and Google
have been taking initiatives to enter into the
lending space.

Digital Wealth Managem ent in Asia Pacific | 72

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 India

Booming FinTech sector supported by increased digitisation and

emerging banking models

India’s booming FinTech sector Growth in WealthTech players and

According to a MEDICI report, India has em erged as robo-advisory platforms
the world’s second-largest FinTech hub, only behind India has been witnessing a steady rise in the num ber
the US.95 of WealthTech players, with ~313 platform s operating
• In 2019, investm ents in India’s FinTech space in the m arket, as of 2019.98 In 1H20, the FinTech sub-
have doubled as com pared with 2018.96 segm ent has witnessed an inflow of about US$213
m illion and is ranked 3rd in term s of num ber of
operators, only behind paym ents and lending.99
% Breakdown of FinTech firms, b y sub -sector • The segm ent m ainly consists of robo-advisory
(August 2020) 97 platform s, personal finance m anagem ent platform s,
m icro investm ent m anagem ent platform s and digital
investm ent platform s.
19% Payments
Lending As of 2019, the AUM of the robo-advisors stood at
34% US$42 m illion, which is further expected to grow at
100% = WealthTech
CAGR of 36.2 percent to reach US$145 m illion by
2,173 firms 17% Personal Finance 2023.100
InsurTech Growth in the WealthTech space is attributed to their
3% 14% RegTech low-cost technology-driven operation m odels which has
8%
5% Others been able to attract investm ents from the rising m iddle-
and upper-m iddle class and drives financial inclusion.
Source: KPMG analysis based on data from MEDICI
Limited adoption among UHNWIs
Growth in FinTech funding is m ajorly attributed to
India’s large consum er base, high FinTech adoption According to a 2018 survey by Kotak, m ost UHNWIs in
rate and accelerating digitisation. India are unaware of the rising robo-advisory
services.101
It revealed that though robo-advisory has becom e
popular in developed countries, it is still at a very
nascent stage in India.
UHNWIs in India still prefer traditional wealth
COVID-19 has in fact fast tracked m anagem ent services that allow one-on-one interaction
the digital economy and significant with wealth m anagers.
investments are being made by
established banks … which can Digital transformation : State Bank of
also lead to acquisition and more India (SBI)
investments from investors. With an intent to im prove custom er service, stream line
operational processes, and optim ise business m odels
SBI launched several digital advancem ent initiatives.
— Sanjay Doshi, Partner, KPMG India For instance:
• Under its initiative ‘Custom er Channel Roopantar’ it
introduced several digital solutions to enhance
Emerging collaborative banking models custom er experience including SBI Digi Voucher:,
SBI Video Statem ent, SBI Mingle, etc.
In India, banks are not allowed to operate as digital-
• The bank adopted SBI Workspace, a com prehensive
only banks; instead, the digital banking m odel works
solution which provides secure access to internal
as a partnership between licensed banks and non-
applications and resources such as staff facing
banks, term ed as ‘Neobanks’.
m obile and tablet applications, intranet applications,
• Open FinTechs collaborated with ICICI bank to em ail, docum ents collaboration, etc.
offer digital banking services. • Also, to enhance productivity the bank intends to
deploy software robotics in its back office to
These banks are gaining significant hold in India’s FS
landscape and intending to launch m ore products autom ate processes.
within the wealth m anagem ent space, for instance
• Niyo, a FinTech with digital banking solutions, Impact of COVID-19
acquired a m utual funds platform Goalwise, to
launch a robo-advisory based investm ent service – Despite the ongoing COVID-19 pandem ic, the
‘Niyo Wealth’. FinTech industry continued to gain m om entum
in 2020 and has witnessed significant
deploym ent of funds. According to a KPMG
report, in 1H20, funding in Indian FinTechs
doubled from 1H19 to US$1.7 billion.102
73 | Digital Wealth Managem ent in Asia Pacific
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 India

Government initiatives to promote digital financial services

In the past few years, India’s central bank, the Reserve Bank of India (RBI) has focused on
creating policies that encourage new forms of lending and payment institutions, such as
mobile wallets, P2P lending and payment banks. It has also made regulatory changes to
support digitisation of banking, such as encouraging digital KYC processes and launching a
regulatory sandbox.

New guidelines for digital KYC Regulatory sandbox for FinTechs and
In April 2020, the Securities and Exchange Board financial institutions
of India (SEBI) issued new guidelines to In August 2019, RBI perm itted start-ups, banks
standardise the digital KYC norm s. One of the key and financial institutions to set up a regulatory
developm ents was rem oving the physical sandbox for live testing of innovative products in
verification m andate and allowing the use of the fields of retail paym ents, m oney transfer,
digital platform s to verify identity and address m arketplace lending, digital KYC, financial
docum ents. Further, it also perm itted advisory, wealth m anagem ent and digital
interm ediaries to do video-based KYC. identification services.
With these reform s and integration of various This will enable authorities to bring new
digital platform s, banks will conduct a large part of regulations or m ake regulatory changes required
KYC and account-opening processes online, to support innovation as well as enable FinTechs
resulting in greater efficiency and quicker to reach the end m arket faster.
turnaround.

New department to focus on FinTech Guidelines for interoperability of

mobile wallets
In March 2020, the RBI decided to set up an
exclusive departm ent of FinTech to focus on In October 2018, RBI issued operational
digital transactions and adoption of technology guidelines on interoperability of all m obile wallets
across all aspects of banking and non-banking i.e. wallet-to-wallet transfers across m ultiple
services. issuers. One m ajor update was allowing these
transfers between KYC-com pliant issuers of
This will prom ote growth of FinTechs in the Indian prepaid paym ent instrum ents (PPIs) by relying on
m arket, resulting in faster advancem ents in digital UPI or card network infrastructure.
financial services and com petition for the
This will enable m obile wallets to act as quasi-
traditional players.
banks in term s of paym ents, increasing
com petition between m obile wallet com panies,
paym ents banks and traditional banks.

Digital Wealth Managem ent in Asia Pacific | 74

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 India

Providing regulatory relaxations and other measures to open up to

global developments in banking

The government of India has however not implemented any major regulations that promote digital
wealth management. Although, few favourable initiatives such as allowing e-commerce players to
enter the wealth management space coupled with stringent investor protection laws are
encouraging the growth of digital wealth management in the market.

Introduction of Investment Advisers Relief for cross border payments

Regulations 2020 In 2019, RBI provided som e relief to the international
In July 2020, SEBI brought certain regulatory changes players by allowing them to store transactions data in
to the Investm ent Advisers Regulations, with the a foreign m arket, in cases where the transaction
m ain objective to give im portance to the interest of originates in India but gets com pleted overseas.
investors over investm ent advisors. The new changes However, for end-to-end dom estic transactions, all
addressed the m alpractices of investm ent advisors data needs to be stored within India.
related to charging excess fees, non-disclosure of This will help foreign players save substantial costs
com plete service fee and extracting m oney in the on setting up data processing infrastructure in India,
nam e of various charges. as they can continue to do data processing and
It also segregated advisory and distribution services analytics outside India, where they would already
for non-individual entities (including banks) at the have well-developed IT infrastructure.
client level, im plying that these entities despite
having different departm ents for advisory and
distribution, cannot provide both services to a single
client.

75 | Digital Wealth Managem ent in Asia Pacific

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 India

Ombudsman Scheme for Digital

Transactions
In 2019, RBI introduced ‘Om budsm an Schem e for
Digital Transactions’ covering services provided by The scheme is introduced to
entities falling under its regulatory jurisdiction. This is facilitate the satisfaction or
an apex level cost-free m echanism for resolution of settlement of complaints
com plaints regarding digital transactions undertaken
by custom ers.
regarding digital transactions
undertaken by customers of
The schem e aim s to tackle frauds associated with system participants as defined
digital transactions, resulting in boosting custom er
under the scheme.103
confidence to carry out online financial transactions
effectively.

— Reserve Bank of India

Digital Wealth Managem ent in Asia Pacific | 76

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 India

Domestic players dominate the market, with growing market share of

leading wealth managers

Growing wealth management and Moreover, these banks have a 360-degree view of
private banking their clients, enabling them to develop m ultiple
tailored solutions to m eet clients’ needs.
Leading private banks and wealth m anagers in India
continue to grow their com bined m arket share.
According to Asian Private Banker’s AUM League
Rising competition from leading wealth
table for India 2019, total AUM of the top 20 players
reached US$237 billion, a y-o-y increase of 21 managers
percent.104 Leading wealth m anagers such as IIFL and Edelweiss
The top three players within the list — Kotak Wealth are providing cost efficient advisory services to
Managem ent, ICICI Bank Private Banking and IIFL clients, thereby giving strong com petition to
Wealth — accounted for ~40 percent of the traditional banks.
com bined AUM of India’s top 20 players.105 • Edelweiss has already launched its own robo-
As per the report, dom estic players have witnessed a advisor — Guided portfolio — that recom m ends
sharp increase in their m arket share in the recent investm ents portfolios as based on custom ers’
years, rising from 60 percent in 2015 to 78 percent in goal and risk appetite, while IIFL is investing in
2019.106 start-ups that provides robo-advisory services such
as 5Paisa.
Moreover, to better support clients, they are
Leading banks ideally placed to cater to strengthening digital capabilities of their wealth
clients advisors. For instance:

In India, traditional banks are better placed to provide • IIFL launched AAA, a m obile based platform that
wealth m anagem ent services to HNWIs due to the allows its wealth m anagers to m anage clients’
presence of established fram eworks that understand investm ents, access quality research and training,
risk preferences of clients, efficient due diligence and m onitor business perform ance.
m easures in choosing products and significant focus
on com pliance.

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 India

Comparison of digital capabilities and offerings by leading players for HNW clients
In India, WealthTechs are leading in term s of offering different digital capabilities to their custom ers. Most traditional
wealth m anagers provide custom er features and digital execution capabilities, whereas WealthTechs are well advanced
and provide a wide range of digital services including robo-advisory, trade execution and Big-Data analytics. For
instance; INDWealth leverages m achine learning algorithm s to recom m end investm ent option and tax saving solutions.

Digital capabilities Kotak ICICI HDFC HSBC SCB IIFL Edelweiss IND Wealth Cube Wealth Groww
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
Customer Features

research and insights ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Portfolio management ✔ ✔ ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔ ✔ ✔ ✔ ✔

Digital account opening ✔ ✔ ✔ ✔ ✔ ✔ ✔

Financial planning, analysis,
goal and investment tracking ✔ ✔ ✔ ✔ ✔

FX trading ✔ ✔ ✔
Digital execution

Equity trading ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Fixed Income trading ✔ ✔ ✔ ✔ ✔ ✔ ✔
Structured Product booking ✔
Funds (ETF) trading ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
IPO subscription ✔ ✔ ✔ ✔
Robo-advisory ✔ ✔ ✔
solution
Internal

Big Data analytics ✔ ✔ ✔

Digital offering to facilitate
client interactions ✔ ✔ ✔ ✔ ✔

Leading traditional banks Leading wealth m anagers Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

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 India

With limited penetration currently, substantial prospects for banks to

enhance digital wealth services

Recommendations
Banks should focus on enhancing their overall digital
capabilities, either by partnering with FinTech firm s or
by launching new digital products and services
targeting high net worth clients.

Like leading wealth m anagers such as IIFL and

Edelweiss, banks can also provide online trading in
equities, fixed incom e and FX securities to their
clients across international stock m arkets.

With increasing com petition from digital platform s

such as INDWealth, banks can also look to launch
their own dedicated wealth m anagem ent platform s
that leverage AI or Big Data analytics to m anage
clients’ investm ents based on their financial goals and
to offer personalised financial advice to them based
on their needs and preferences in a cost-effective
way.

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 India

Leading players and their digital

wealth management offerings

Leading traditional banks

Kotak Mahindra Bank ICICI Bank

Descrip tion Descrip tion

• One of the oldest wealth m anagers in India, Kotak • One of the largest private sector banks in India,
m anages wealth for 50 percent of India’s top 100 serving 88 percent of savings account transactions
fam ilies through digital channels
• Strong focus on building digital capabilities and • Strengthened data analytics and m arket
becam e the first Indian bank to pioneer video- intelligence capabilities for creating strategies to
based KYC for new custom ers enable better targeting, channel and product
alignm ent
• Offers a com prehensive and holistic platform
covering the entire gam ut of financial services for • Launched ICICIStack, a com prehensive digital
its UHNWI clients banking platform offering services to custom ers
including retail, business banking, SME and
• Priority Banking business assists m ass affluent
corporate custom ers
clients with products and solutions built to m eet
their financial requirem ents

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Kotak Wealth app, allows access to m utual funds • Mutual Funds Transaction p latform, an AI-
and exclusive Investm ent solutions based on the based investm ent platform for investm ent in
risk appetite of investors m utual funds that uses sm art algorithm s to create
a custom ised portfolio basis investm ent profile
• Asset register, provides a consolidated statem ent
and tries to optim ise returns for a given level of
of all assets (ranging from financial to non-financial
risk
and physical to digital) at one place, which can be
further used to create online wills • iWealth, a m obile app that provides intelligent
insights on m utual fund investm ents and suggests
• Smart Overdraft, helps in m anaging finances
a suitable portfolio; also assists in real-tim e
with an unsecured overdraft lim it for salaried
portfolio re-balancing
individuals
• Video Banking ap p , exclusive offering for
• Smart Will, a tool that facilitates custom ers to
privilege, wealth and Non Residential Indian (NRI)
prepare a will for seam less transm ission of wealth
custom ers to connect with the ICICI Bank
to their heirs as part of succession planning
custom er service representative
• e-locker, an online docum ent storage facility to
store all the valuable docum ents in one central
secure location

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 India

Leading players and their digital

wealth management offerings

Leading traditional banks

HDFC Bank HSBC

Descrip tion Descrip tion

• One of India’s leading prem iere private banks, • HSBC Prem ier offers wealth m anagem ent
HDFC provides a wide range of financial products solutions that addresses individual needs
and services to ~33 m illion custom ers
• More focused on providing in-person assistance;
• Continues to invest in technology, com puting and relationship m anagers assist clients with the Goal
AI to provide hyper-personalised offerings to its Planner, an offline financial planning tool, that
custom ers, with the aim of becom ing a digital-first helps to m anage financial needs and provides
bank com prehensive financial analysis and tailored
wealth solutions
• Offers Prem ier Banking services to HNW clients
to m eet their financial needs

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• InvestNow, a m utual fund investm ent platform • HSBC Advance offers access to seam less
that provides custom ers with expert banking service, including funds transfer, and
recom m endations based on their financial goals provides a secure online platform to m anage
and risk appetite client’s investm ents
• InvestTrack, a structured tailored process that • Wealth dashb oard and Retail Investm ent System
helps to identify investm ent opportunities in line (RIS) provide the convenience to take inform ed
with goals and risk appetites; also provides a financial decisions, allowing clients to stay
consolidated view of m utual Fund investm ents, updated on the m arkets and their investm ents
HDFC Life policies, savings, current and fixed
deposit account balances
• Virtual Relationship Manager, com plem ented
with various digital tools such as web chat with
Eva, rem ote banking via Apple Watch and service
assistance via Facebook Messenger
• e-will, assists individuals to write their personal
will online

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 India

Leading players and their digital

wealth management offerings

Leading traditional banks

Standard Chartered Bank (SCB)

Descrip tion Digital offerings in wealth management and

p rivate b anking or for affluent clients
• A leading foreign bank operating in India since
1858 • Online Trading web site provides extensive
research and an integrated view of users’ holdings
• Offers phone banking, online banking and SMS
and transactions with advanced reports
banking services to its custom ers
• SC Trading Mob ile platform capabilities include:
• Straight2Bank onboarding portal allows digital
account opening • IPO investing and 24X7 trading in equities,
derivatives, bonds
• Introduced Prem ium Banking service to serve
em erging affluent clients • Inter-segm ent transfer and personalised
m arket watch
• Launched real-tim e on-boarding for Credit Cards
and Personal Loans • Intra-day charting, quick access to holdings and
inter-segm ent fund transfer
• Portfolio management service offers
m anagem ent consulting and adm inistration
solution for entire equity investm ent portfolio

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 India

Leading players and their digital

wealth management offerings

Leading wealth managers

IIFL Edelweiss

Descrip tion Descrip tion

• Incorporated in 1995, one of the biggest wealth • Established in 2010, Edelweiss wealth
m anagers in India with AUM of about US$24 m anagem ent is am ongst top three wealth
billion m angers in India, in term s of AUM
• Launched digital gold loan, which allows • Offers India’s first “subscription-based” wealth
custom ers to avail loans without visiting branch m anagem ent platform – Infinity

• Launched digital Finance initiative, to collaborate • Continues focus to enhance custom er experience,
with e-com m erce portals, to offer financial for instance:
solutions to their m erchants
• Collaborated with Definedge Solutions, to
• Introduced IIFLDisrupt, to support FinTechs integrate analysis and trade execution
(focused on WealthTech, InsurTech, robo- platform s
advisory), that struggled due to COVID-19
• Partnered with Signzy — a RegTech startup for
digital custom er onboarding and a faster
verification process

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients

• Launched IIFL-ONE p latform based on • Offers a desktop trading terminal TX3, a

transparent “All-in-fee” structure, the idea is to technology driven trading solution, designed to
enhance client experience with less cost. Under cater to the new age and professional traders.
the platform it also provides custom ised portfolio
• Provides Mob ile Trader app, that allows
m anagem ent offerings: MANDATE and CONSULT
custom ers to execute trades, view portfolio,
• It provides IIFL Markets ap p , that allows access buy/sell recom m endations, stock m arket
custom ers to execute trades, view portfolio and com m entary and industry reports.
access buy/sell recom m endations and industry
• Offers Guided p ortfolio, a robo-advisory service
reports.
that recom m ends portfolio based on custom ers
• Launched AAA — Advisor Anytime Anywhere, goal and risk appetite.
m obile based platform for its wealth advisory
• Launched a m ulti-product platform — Edelweiss
partners; allows them to m anage clients’
Partners, for its business associates; allows
investm ents, access quality research and training
access to different products in the m arket like
and m onitor business perform ance
m utual funds, IPOs, NCDs, com pany fixed
deposits and hom e loans.

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 India

Leading players and their digital

wealth management offerings

Leading wealth management platforms

INDWealth Cube Wealth Groww

• A wealth m anagem ent • A digital wealth • An investm ent platform for

platform based on m achine m anagem ent service that m illennials with over Nine
learning, AI and data science offers busy professionals m illion users that allows
that offers personal financial investm ent options on its investors to invest m oney
advice across asset classes, app along with expert with stockbroking and direct
loans, and tax m anagem ent advice. Also, guide investors m utual funds
to affluent segm ent and to create an investm ent
• Som e of the features include
HNWIs portfolio and provides
investm ent m anagem ent,
anytim e assistance from
• Features include goal-based overview of funds
dedicated wealth coaches
financial planning and future perform ance and investm ent
projections, portfolio • Uses gam ification to help tracking
m anagem ent, tax analytics users invest through the app
• Expanded its offerings to
and tax-saving strategies as and provides investm ent
allow users to buy stocks of
well as personalised options across asset
Indian firm s and digital gold
recom m endations of classes, including m utual
and is also planning to
investm ent products funds, foreign equities,
launch international equities,
digital gold and stock trading
• Enrolled certified wealth where users can invest in
to help users diversify their
advisors for every user US stocks
investm ent
fam ily and launched a wealth
• Recently raised US$30
advisor facing web • Started international
m illion in Series C funding
application, creating investm ents, allowing
round led by YC Continuity,
com m unication and investors to buy and sell US
the growth-stage investm ent
feedback loops between the and other countries' equities
fund of Y Com binator
custom ers and advisors on its app without visiting a
bank or any other institution
• Recently raised US$12.3
m illion in Series C funding • Launched a new cross-
round from Steadview border software-as-a-service
Capital and Tiger Global (SAAS) and m arketplace —
Cube Cloud — to help fund
m anagers in India and
Southeast Asia track capital
from investors across fifty
countries

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 Australia

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 Australia

Large HNW population with growing online and mobile banking

adoption

Rise in mobile banking and payments

Australia has high internet penetration and is witnessing growth in m obile usage for accessing banking services and
m aking paym ents. Consum ers are increasingly becom ing com fortable with the latest technologies in this dom ain, such
% as tap-and-go.

88%
Internet penetration in
90%
Customer satisfaction in
Australia, with a total of mobile banking, the
22.3 million internet fastest growing banking
users107 channel in Australia108

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 Australia

Slow adoption of advanced digital Large HNW base with growing

services, e-wallets demand for digital financial services
Digital wallet adoption in Australia, although People with over
rising, is substantially behind m ost countries. US$1 million in
There is still a long way forward for the m arket
to m ove from sim ple m obile paym ents to m ore
investable assets
extensive uses, such as loyalty program m es,
m ass transit ticketing and m any other
innovations.
1.5M (including their
primary residence),
the third-largest HNW
population in Asia
Pacific111
Australians use digital
wallets (vis-à-vis Growth expected in
9.8% >50% in many other
Asian markets), with
Australia’s HNWIs
during 2020–24 to
Apple Pay being the
most popular109 34% reach 2.1 million;
UHNW population to
grow at 29% to reach
4,881112
Banks do not offer
account integration Destination for
23% with Apple Pay,
Google Pay or
migrating HNWIs
globally; 11% HNWIs
Samsung Pay110
#1 who moved out of
their home countries
in 2018 took up
residency in
Australia113

Australia is hom e to the third-largest HNW

The market opportunity in population in Asia Pacific,114 with a rising
Australia needs to be understood dem and for digital financial services, such as
in the context of both equity in robo-advisory services in wealth m anagem ent.
property and the mandatory Moreover, with strong growth expected in the
superannuation system size of this dem ographic in the com ing years, it
(including self managed super is likely to lead to m ajor opportunities for private
funds), as major drivers of private banks and wealth m anagers to address the
wealth. advisory needs of this group.

— Hessel Verb eek, Partner, Strategy,

KPMG Australia

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 Australia

Strong growth opportunities exist for financial advisors within

Australia’s wealthier client base

Large untapped HNWI market for Gradual improvement in existing

financial advice low satisfaction levels of HNWIs
While Australia’s HNWI population has been with banking relations
growing at a fast pace, its private banking and According to a research conducted by the Roy
financial m anagem ent providers haven’t been able Morgan Research Institute, the wealthiest 30
to catch up equally, indicating a strong potential to percent of Australians were found to be less
tap this opportunity. satisfied with their banking relationships (~75
• As per a 2018 Financial Advice Report, during percent), vis-à-vis the bottom 30 percent
2008–16, HNWIs in Australia increased 41 Australians who had a satisfaction level of ~85
percent, while the num ber of HNWIs using a percent.118 This gap has significantly widened
financial advisor grew by only 16 percent.115 during 2013–18, reflecting the unm et advisory
Sim ilarly, according to statistics provided by needs of HNW clients.
NAB, less than 20 percent of the HNWIs in • According to a 2019 HNW Investor report,
Australia had a private banker in 2018 58 percent of HNWIs in Australia had unm et
(com pared to m ore than 70 percent in the financial advisory needs, particularly with
UK).116 respect to inter-generational planning, ETFs
and identifying undervalued assets.119
Comp arison of growth in HNWIs and HNWIs
with financial advisors during 2008-16117 However, the views of these wealthy investors
toward financial planners, investm ent advisors
41% and private bankers have shown notable
im provem ent.
• The HNW report revealed that in 2019, ~29
percent investors showed interest in using
an advisor to access a wider range of
investm ents and second opinion, com pared
with ~22 percent in 2018.120
16%

Growth in HNWIs Growth in HNWIs with a

financial advisor
Source: KPMG analysis based on data from Investment
Tren ds 2017 HNW Investor report

With growing wealth and a consequent rise in

investm ent com plexities, the use of private
bankers and wealth m anagers is also increasing,
with dem and for financial advice in the m arket
expected to considerably exceed the current
supply levels.

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 Australia

Growing digital preferences of HNWIs are compelling banks/wealth

managers to evolve

Rise in demand for robo-advisory Greater usage of digital payment

services and alternative investment methods with the introduction of NPP
channels In February 2018, the New Paym ents Platform (NPP)
As Australian HNW investors are digitally savvy was launched as a strategic part of Australia’s vision
and financially skilled, they have started for a digital econom y. NPP is an industry-wide
em bracing new digital tools for real-tim e portfolio platform designed to m ake real-tim e, 24/7 paym ents
inform ation as well as for digitalised investm ent with richer data and sim ple addressing using PayIDs.
execution. As a result, robo-advisory has started
to gain m om entum . Numb er of monthly NPP p ayments (in millions) 123

50

According to a 2020 GlobalData 40

survey, Australian HNW 30
investors use an average of four 20
different wealth m anagers, 10
driven by the rise in autom ated
0
investm ent services.121

However, with growing adoption of robo-advisory Source: R eserve Bank of Australia

services, traditional players are facing a m ajor
Since its launch, paym ent volum es over the NPP have
im pact on their bottom lines as HNW clients have
been growing rapidly, and the platform had processed
becom e increasingly fee-sensitive due to the low-
631 m illion paym ents worth AUD609 billion till July
cost business m odels of robo-advisors. According
2020.124
to the GlobalData survey quoted above, 76
percent of wealth m anagers in Australia have The top four banks — CBA, NAB, Westpac and ANZ
lowered or are planning to lower their fees to Bank — as well as HSBC are am ong the 13
com pete with robo-advisory service providers.122 shareholders of NPP, and all m ajor banks in Australia
have already rolled out the NPP paym ent functionality
to different custom er segm ents and channels.
According to NPP Australia, the platform ’s adoption is
expected to grow further to a wider range of
While there is a strong rise in organisations, ranging from new neobanks, paym ent
demand of alternative channels service providers, cross-border rem ittance
due to loss of trust with traditional com panies, cryptocurrency exchanges, FinTechs,
advisory channels and loss of corporates as well as governm ent agencies.
belief that traditional services yield
better returns, the current
regulation around robo-advice Wealth managers and private bankers
remains restrictive. moving away from leading banks
Financial advisors from top Australian banks have
— Hessel Verb eek, Partner, been recently m oving away to m eet the changing
KPMG Australia dem and of investors. In 2015, the num ber of advisors
em ployed by or aligned to m ajor financial institutions
accounted for 60 percent of the industry.125 However,
this num ber has reduced to 40 percent in 2019, and is
Moreover, it has been observed that there is a falling fast.126
rising preference am ong investors for peer-to-peer
investing. Australians, particularly from m illennials Som e of the m ajor reasons for this m ovem ent have
and Generation X age groups are increasingly been lack of self-autonom y, resistance to adoption of
m oving their term /savings deposits onto peer-to- latest technology by these firm s and focus on in-
peer lending platform s for better yields. house m anaged funds and investm ent products.

This has resulted in creation of new entities or wealth

m anagem ent platform s such as Crestone Wealth
Managem ent (a m anagem ent buyout of UBS
Australia's wealth division), Escala Partners (a UBS
offshoot) and Koda Capital (an offshoot of NAB).
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 Australia

Government opening up to global developments in banking with

certain initiatives/relaxations

In recent years, the Australian government has introduced regulatory reforms that (directly or
indirectly) support the growth of digital financial services. Measures to support FS start-ups,
promote online payments and launch open banking, have contributed to developing Australia as
a market for advanced financial products.

Enhanced support for FinTech start-ups Eased cross-border payments

In Australia, to be considered a ‘neobank’ or a ‘digital The Reserve Bank of Australia has been working
bank’, banks are required to have a deposit-taking closely with the Reserve Bank of New Zealand,
(ADI) licence issued by the Australian Prudential AUSTRAC and South Pacific central banks to
Regulation Authority (APRA), after a range of develop a regional fram ework to reduce cross-
requirem ents are m et, the key one being capital border paym ent costs.
adequacy. However, such authorities are now trying • One key initiative includes adoption of the
to ease certain rules to prom ote digital banks and ISO20022 standard that enables end-to-end
FinTechs. paym ent processing between traditional
• APRA recently established a regulatory route for infrastructure and new system s across
licensing ‘Restricted ADIs’, that allows new dom ains and geographies, prom oting
entrants to conduct lim ited banking business in standardised and richer paym ents.
their startup phase under a sim pler fram ework,
m aking it easier to develop their capabilities and
Proposal to place limits on cash
resources.
payments
• In May 2020, the governm ent enhanced its
existing ‘Regulatory Sandbox’ fram ework that The recently introduced Currency Bill 2019
enables FinTechs to test new financial products proposes to ban cash paym ents over A$10,000 to
and services without the need for an Australian FS end tax avoidance, m oney laundering and other
licence. It extended the duration for this to 24 black econom y activities. If passed, it is expected
m onths, up from 12 m onths earlier.127 to result in a spur in the already increasing digital
paym ent volum es in Australia.

Roll out of the Open Banking regime Renewed GCRA standards and higher
In July 2020, the Australian Com petition and supervision
Consum er Com m ission (ACCC) finalised the rules In 2019, APRA, with inputs from the Royal
governing the Consum er Data Right regulations, Com m ission post its investigation on m isconduct
providing a legal fram ework to launch Open Banking in the FS industry, introduced strong changes to
in the m arket. the GCRA (Governance, Culture, Rem uneration
Consum ers can now direct banks to share data and Accountability) practices in Australia. It
pertaining to their credit/debit cards and deposit/ includes raising GCRA standards, intense
transaction accounts with FinTech firm s and other supervision, and greater transparency and
third-party providers (TPPs). In Novem ber 2020, this declarations from FS entities. The additional costs
will be extended to data relating to their hom e, related to these requirem ents are em erging as a
investm ent and personal loans, as well as joint key concern for banks.
accounts.

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 Australia

Opportunities in wealth management as incumbents make space for

emerging players

Rising wealth management exits from While both dom estic and global banks are
large banks withdrawing from the wealth m anagem ent segm ent
in Australia, these banks are planning to boost their
The banking industry in Australia is dom inated by the private banking services for HNW clients. For
big four banks — CBA, NAB, Westpac and ANZ Bank exam ple, NAB and Citi are hiring m ore private
— which account for ~80% of total banking assets.128 bankers to attract wealthy clients.
However, these banks have started exiting the wealth
m anagem ent segm ent after recom m endations from
the Royal Com m ission dem anded greater regulatory Growth in digital wealth management
oversight from banks, increasing their cost of doing platforms
business.
Apart from traditional banks, there are various other
• CBA recently sold its m ajority stake in Colonial players that offer digital wealth services in the
First State business to KKR, and ANZ sold its m arket, either directly to investors or to financial
wealth m anagem ent arm to IOOF. After offloading advisors or both. This includes em erging digital
its financial advice operations in 2019, Westpac wealth platform s, such as PictureWealth and Net
has put its wealth assets under review while NAB wealth, and robo-advisory services providers such as
plans to sell its MLC Wealth subsidiary in 2020. Stockspot and Six Park.
This displacem ent of the big four banks from the These wealth m anagers seem to have an edge over
sector is creating opportunities for the new players, the traditional players, prim arily led by their robo-
particularly FinTechs in the wealth m anagem ent advisory services as well as a higher variety of wealth
space, HNW investors in Australia are m ore digitally m anagem ent capabilities offered on their digital
savvy and are looking for innovative solutions at low platform s.
cost.

91 | Digital Wealth Managem ent in Asia Pacific

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 Australia

Comparison of digital capabilities and offerings by leading players for HNW clients
In Australia, WealthTechs are well placed in term s of offering robo-advisory services and digital capabilities related to
custom er features. Traditional banks are leading in term s of providing digital execution capabilities, with a focus on
prom oting trading and investm ent am ong the m ass population by launching platform s that allow users to initiate
investm ents with very sm all am ounts. Also, they provide tools to access detailed research/insights that facilitate
investm ent decisions.

Picture
Digital capabilities CBA ANZ NAB Westpac HSBC SCB Stockspot Six Park
Wealth
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
Customer Features

research and insights ✔ ✔ ✔ ✔ ✔ ✔

Portfolio management ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔ ✔ ✔ ✔

Digital account opening ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Financial planning, analysis,
goal and investment tracking ✔ ✔ ✔

FX trading
Digital execution

Equity trading ✔ ✔ ✔ ✔ ✔
Fixed Income trading ✔
Structured Product booking
Funds (ETF) trading ✔ ✔ ✔ ✔ ✔
IPO subscription ✔
Robo-advisory ✔ ✔ ✔ ✔
solution
Internal

Big Data analytics

Digital offering to facilitate
client interactions ✔ ✔

Leading traditional banks Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

Digital Wealth Managem ent in Asia Pacific | 92

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 Australia

With limited presence, strong prospects for foreign banks to bolster

their digital wealth and banking services

Recommendations
Banks should focus on enhancing their digital
offerings, either by partnering with FinTech firm s to
develop new solutions or by launching their own
digital products and services targeting HNW clients.

They can also look to launch dedicated wealth

m anagem ent platform s, powered by robo-advisory,
offering personalised financial advice to their clients
based on their needs and preferences in a cost-
effective way.

As the ‘Big Four’ Australian banks are divesting from

wealth m anagem ent and bolstering their private
banking segm ent, foreign banks should also
strengthen their private banking arm with tech.
investm ents and hiring of private bankers who are
m oving away from top banks.
Also, banks should focus on bolstering their technical
capabilities to support their wealth m anagers, m aking
the process m ore agile and leading to overall
im provem ent in custom er satisfaction.

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 Australia

Leading players and their digital

wealth management offerings

Leading traditional banks

Commonwealth Bank of Australia (CBA) Australia and New Zealand Bank (ANZ)

Descrip tion Descrip tion

• One of the four largest banks in Australia with a • Large Australia-based bank having 6.4 m illion
strong footprint in digital banking custom ers, of which, 3.6 m illion custom ers are
digitally active
• Com m Bank m obile app serves ~7 m illion active
digital custom ers, with 7.4 m illion logins daily • ~2.8 m illion of the bank’s custom ers use ANZ
app, with m ore than AUD380 m illion worth of
• Aim s to establish 25 new FinTech-focused
transactions every day
businesses in the next five, years for which it has
set up an entity ‘X15’ • Plans to build flexible and resilient digital
infrastructure that supports great custom er
• Plans to invest AUD5 billion in the next 5 years to
experience at lower cost
im prove digital capabilities

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Mobile apps for Com m onwealth Private clients: • ANZ Private Investment Platform provides
holistic view of investm ents with the flexibility to
• CommBank Prop erty – A property search
execute in a self-directed, advised or discretionary
powered by Dom ain with the option of
m anner
including finances
• Provides Financial Wellbeing Score calculator
• CommBiz – Online business banking platform
that enables custom ers to know their financial
• CommSec Equities Ap p , that allows to trade health
stocks from about 25 international m arkets,
• Share trading platform s
with expert stock recom m endations.
• Standard platform provides a com prehensive
• CommSec Pocket ap p lication, that allows
suite of trading tools in an easy-to-use form at
users to start investing with low am ount and
to either start or grow a portfolio
build a portfolio over tim e
• Pro platform is built for advanced traders who
• Also provides support to investors via different
require m ore technical tools and seam lessly
channels including phone, Twitter or online
integrates with standard platform
• Two Com m Bank arm s — Com m Sec Adviser
• ANZ m obile application allows users to view
Services and Colonial First State — team ed up to
and m anage current positions, trade in
launch Portfolio Service (a robo-advisory service),
m arkets, access ASX announcem ents and
aim ed at providing financial advisory services to
explore shares with Morningstar research and
HNW clients
charts

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 Australia

Leading players and their digital

wealth management offerings

Leading traditional banks

National Australia Bank (NAB) Westpac Bank

Descrip tion Descrip tion

• One of the leading banks in Australia, with two • One of the top banking players in Australia, with
thirds of custom ers interacting exclusively through strong focus on digital transform ation
digital channels
• Launched a data platform that supports the
• Moving towards technology transform ation by governm ent’s ‘Open Banking’ regulations and also
adopting cloud and im proving custom er introduced a real tim e NPP
experience
• Partnered with UK cloud tech provider 10x Future
• Ubank, digital only arm of the bank, increased its Technologies to build a standalone digital banking-
custom er base by 40 percent over the last two as-a-service platform , which is expected to be live
years before the end of 2020

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Nab trade – A digital wealth platform for trading • Rolled out Panorama, an Investm ent/wealth
dom estic shares and international shares ( the US, m anagem ent platform providing com pliance-
UK, Hong Kong and Germ any), m anaging funds friendly digital advice to investors, independent
and ETFs financial advisors and their clients
• Provides web, m obile and tablet-based • Offers financial health check program m es for
application that provides custom ers with superannuation m em bers, including the digital
access to their investm ent portfolio, to insights Wealth Review and My Wellbeing online portal
and recom m endations
• Provides Westp ac share trading p latform, that
• Also provides IRIS, an advanced trading allow users to trade in Australian shares via.
platform web/m obile based applications
• Collab orated with Heffron SMSF Solutions • In collab oration with BT, offers its custom ers an
to launch an adm inistration service for Self option to invest in ready-m ade investm ent
Managed Super Fund portfolios and to build their own portfolio by
investing in ASX listed securities and ETFs, term
deposits, m anaged funds and m anaged portfolios

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 Australia

Leading players and their digital

wealth management offerings

Leading traditional banks

HSBC Standard Chartered Bank (SCB)

Descrip tion Descrip tion

• Offers both m obile banking and online banking • Entered Australian m arket in 1964 with an aim to
services to its custom ers facilitate trade and investm ent flows between
Australia and SCB in Asia, Middle East and Africa
• Provides digital corporate banking platform
(HSBCnet) and cash m anagem ent solution (HSBC • Caters to clients in Corporate and Institutional
Om ni Collect) to its clients Banking business only
• Expects NPP and Open Banking regim e to unlock • Services are lim ited to financial solutions such as
new growth opportunities and drive efficiencies financing, guarantees, rem ittances, fund
settlem ent, trade finance, project finance,
syndications, and corporate advisory business
Digital offerings in wealth management and
p rivate b anking or for affluent clients

• Entered the Australian private banking sector in

2016, with the strategy of targeting existing
custom ers as well as HNW custom ers using
products in its retail bank who m ight have private
banking elsewhere
• Provides trading platform s accessible via sm art
phone or tablet; allows custom ers to trade in
variety of products including stocks listed in
Australia, bonds, FX, ETFs, m anaged funds etc.
• Provides advanced charting platform web IRESS,
to facilitate better identification of potential
investm ent and trading opportunities
• Also, provides broker research, buy/sell signals
and daily trading ideas

Digital Wealth Managem ent in Asia Pacific | 96

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 Australia

Leading players and their digital

wealth management offerings

Leading wealth management platforms

PictureWealth Stockspot Six Park

• A digital wealth • An online investm ent robo- • An investm ent robo-advisory

m anagem ent platform , that advisory service provider service provider that offers
com bines the power of that builds custom ised tailored investm ent solutions
digital autom ation and a portfolio using ETFs, giving for clients with a unique
sizeable network of licensed, access to a range of com bination of technology
hum an financial advisers different investm ents with and hum an expertise, at
low fees affordable prices
• Free for clients and provides
access to a gam ut of wealth • Offers portfolio ‘Them es’ • Offers five investm ent
m anagem ent services service, that m ainly focusses portfolios ranging from
including, incom e and cash on capturing HNWIs, conservative to high-growth.
flow m anagem ent, allowing investors to choose Each portfolio is diversified
budgeting and goal tracking, the direction of their across m ajor asset classes
estate planning, personal portfolio to certain and offers a m ix of
insurance and will geographic regions (such as defensive and growth
m anagem ent, m ainland China or the US), investm ents using high-
superannuation, liability asset classes (global quality, ASX-listed ETFs
reviewing, investing, and property or bonds), or
financial advisory m arket factors (sm all
com panies, dividend shares
• Recently raised A$12 m illion
or socially responsible
from private investors, and
shares).
acquired 100 percent stake
of Neo Financial Solutions, • Continued to generate
giving it a com bined positive returns on a rolling
footprint of 94 advisers and 12-m onth basis and five of
A$2 billion in funds under its portfolios outperform ed
advice 464 of 469 sim ilar diversified
funds, as tracked by
Morningstar

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 Australia

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 Malaysia

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 Malaysia

Growing e-wallet payments, digital banking adoption and HNWIs with

strong internet penetration

Robust internet and smartphone penetration

Malaysia was ranked 30th in the Global Connectivity Index 2019 and received top score in term s of internet and
sm artphone penetration.129 Overall im provem ent in internet accessibility, speed and affordability has driven strong
% penetration rates.
In 2019, 25.9 m illion people used a m obile device to access the internet, which is about 96 percent of all internet
users.130

83%
Internet penetration in
90%
Smartphone penetration
Malaysia, with a total of in 2019, well above Asia
26.7 million internet users Pacific’s average
in January 202013 1 penetration rate of 51
percent13 2

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 Malaysia

Rise in digital payment transactions Rising preference for digital banking

via wallets The preference for digital banking service is rising
The increasing availability of sm artphones, am ong Malaysians.
strong internet access, high adoption rate for Based on an online survey conducted by KPMG in
digital paym ent channels and the governm ent’s Malaysia, to assess custom er appetite and
efforts have stim ulated the growth of paym ents concerns for digital banking, about 77 percent of
system s in the m arket. Moreover, COVID-19 1,220 respondents expressed that they believe
has further accelerated this rate of adoption. digital banking is the next evolution in the FS
sector.140
Also, nearly 82 percent of them stated that they
Total transaction value were already using internet banking.141
in digital payments

$12B projected by 2020 —

expected to grow at Malaysians are expected
CAGR of 9.8%
between 2020–24133
~8.4M to have a digital-only bank
account by 2025.142
— Study by Finder.com

Mobile point of sale The survey also revealed that ~82 percent of the
payments projected respondents would consider opening a bank

$1.1B by 2020 — expected

to reach US$5 billion
account through online platform s if they were
regulated by Bank Negara Malaysia.143
by 202413 4 • In line with this trend, several local as well as
global banks operating in Malaysia are focusing
on expanding their digital banking capabilities.

According to Mastercard Im pact Study 2020,

Malaysia is the leader in term s of e-wallet
usage in Southeast Asia.135 Its digital wallet Small HNWI market but rapid growth
usage stood at 40 percent, ahead of Singapore expected
at 26 percent.136
Although the HNW population in Malaysia is
As per JP Morgan estim ates, the fast adoption substantially sm aller than other developed Asian
of e-paym ents channels could lead digital m arkets, it has been growing at a fast pace.
wallets to surpass cash usage in the Malaysian
As per the Knight Frank Wealth Report 2020,
m arket by 2021.137
Malaysia is likely to see one of the highest growth
In Novem ber 2020, e-m oney transactions rates for HNWIs globally, rising at 85 percent (global
reached 200.8 m illion, 11.6 percent higher as average 28 percent) during 2019–24 to reach
com pared to last year.138 37,900.144 Its UHNWI population would grow to
~913 by 2024 from ~675 in 2019.145
As of Decem ber 2019, there were 53 e-wallet
platform s operating in Malaysia, with GrabPay,
Touch ‘n Go, Boost, and Fave being the m ost
People with US$1+ million
net worth (including their
preferred.139
~20K primary residence),
expected to grow at 85%
during 2019-24146

Growth expected in

35% Malaysia's UHNWI

population during 2019–
24147

The expected rise in the num ber of affluent

individuals in Malaysia can be attributed to a
favourable political and econom ic environm ent that
is likely to support wealth creation and protection.
Further, restored confidence in real estate m arket is
expected to drive a rise in wealth.

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 Malaysia

Leading market for Islamic financing, with rising tech spend and focus
on cross-border capabilities

Risk aversion and low preference for This rise in dem and has encouraged banks to
advisory services enhance their cross-border rem ittance capabilities,
which has further led to an increase in
Malaysia’s wealthy individuals are not big users of collaborations am ong banks and FinTechs, for
professional advisory services and are risk-averse, instance:
hence tend to invest in safe and low-yielding
• CIMB collaborated with Ripple to provide instant
investm ents like fixed deposits, property investm ents
cross-border paym ents across the ASEAN banks
and savings accounts.
• MoneyMatch and Malaysian unit of Kuwait
• Unit trust and individual private m andates are
Finance House announced a strategic
popular investm ents given higher awareness as
collaboration to provide cross-border paym ent
com pared with other investm ent products
services.
Also, alternative investm ents such as equity
crowdfunding and peer-to-peer investm ents have
gained som e traction and are expected to see further
Strong Islamic banking and wealth
growth in popularity, although awareness for such
products continues to rem ain low am ong m ost management sector
Malaysians. Malaysia has em erged as one of the global leaders
• Over the next five years AUM for equity in Islam ic finance and now rivals som e of the
crowdfunding and peer-to-peer investm ents will em inent Middle East nations where this segm ent is
grow at a CAGR of 37.7 percent and 53.4 percent, growing.
respectively.148 This rise can be attributed to its ability to innovate
Experts believe that there is a trust-deficiency in the and introduce new financial services, dom inance in
industry, due to lack of wealth m anagem ent talent the sukuk m arket (an Islam ic banking certificate
along with low focus on innovative product sim ilar to bonds) and a favourable regulatory
developm ent. environm ent.
• To further strengthen its position, the
governm ent has expressed intentions to expand
Banks increasing their technology spend Islam ic banking from 28 percent of the financial
sector in 2018 to about 40 percent by 2020.152
Malaysian banks are focusing on enhancing their
digital capabilities and have increased their With m arket expertise and supportive legal
technology spend in the past few years. The average infrastructure for Islam ic Finance, Malaysia is well
share of technology spend in total expenses has positioned to offer a wide array of Islam ic wealth
increased from 4.1 percent in 2016 to 6.4 percent in m anagem ent products and services.
2018 (although still far behind Singapore with 13.2
• Labuan IBFC — a special econom ic zone in
percent).149
Malaysia — has been evolving as a leading
• CIMB and Hong Leong Bank raised their centre for catering to the needs of global Islam ic
technology spend from one percent and 5.5 wealth m anagem ent. It offers a com plete suite
percent in 2016 to nine percent and eight percent of Islam ic wealth m anagem ent structures and
in 2018, respectively.150 solutions, effective regulatory standards, a
Shariah supervisory council and a favourable
This rise in spend can be attributed to the growing
business environm ent.
com petition from new entrants, especially innovative
start-ups, which has forced Malaysia’s traditional International banks have also started taking
financial institutions to increase their digitalisation initiatives, reflecting their com m itm ent towards
efforts. Islam ic finance, for instance:
• BNP Paribas Malaysia and International Centre
for Education in Islam ic Finance, have
Banks boost cross-border payment established the Centre for Islam ic Wealth
capabilities Managem ent, an initiative to support the growth
of Islam ic wealth m anagem ent industry.
Rapid expansion of cross-border trade, as well as
higher preference of Malaysian online shoppers for
cross-border shipping (~40 percent online
transactions are cross-border),151 has led to an
increase in dem and for such transactions and
paym ents.

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 Malaysia

Government strengthening regulations and promoting digitisation in

banking and capital markets

Regulators in Malaysia are working with the government to speed up digitisation in banking and
capital markets. The free trade zone, Labuan, is a major attraction to wealth management
customers. However, areas such as digital asset training, digital asset fundraising, equity
crowdfunding, and peer-to-peer financing are highly regulated. A few recent initiatives/regulations
such as the lengthy process of setting up a digital bank and widening of the scope of stamp duty
remission to all the transfers may also act as a barrier to the growth of wealth management
segment in the Malaysian market.

Promoting innovation in investment Legalised digital asset and crypto trading

management In July 2020, Malaysia’s SC perm itted the trading of
In May 2017, the Securities Com m ission (SC) in digital assets and tokens at the registered digital
Malaysia introduced the ‘Digital Investm ent asset exchanges stim ulating developm ent and
Managem ent’ fram ework, setting out licensing and greater investm ent in digital assets.
conduct requirem ents for the offering of autom ated • Till now, the com m ission has allowed three digital
discretionary portfolio m anagem ent services. asset exchanges — Tokenize, SINEGY, and Luno
• Since then, various start-ups and fund m anagers — to operate in the Malaysian m arket.153
have been tapping into this segm ent and
em bracing innovation to better engage with the
investors, while at the sam e tim e m aking Building up cross border payments
investm ents affordable and accessible to all. infrastructure
Bank Negara Malaysia (BNM), the central bank of
Malaysia, has been planning to address gaps in cross-
Labuan mid-shore jurisdiction favours
border paym ents infrastructure of Malaysia and has
investors highlighted its efforts to integrate real-tim e retail
The m id-shore jurisdiction of Labuan IBFC provides paym ents infrastructures under the ASEAN Paym ents
access to Malaysia’s extensive double taxation treaty Policy Fram ework.
network and a sim ple and straightforward tax system . • BNM is also working to m igrate to ISO 20022,
• The system is com plem ented by laws to elim inate which is expected to drive greater paym ents
‘fiscal friction’ as it does not include any exchange efficiency, facilitate risk m anagem ent as well as
control, transfer taxes, withholding tax and indirect facilitate cross-border connectivity.
taxes, thereby acting as an attractive spot to
facilitate cross-border transactions, business
dealings and wealth m anagem ent for investors in
the Asia Pacific region.

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 Malaysia

Gearing up for digitisation in banking Increased tax rates and restricted stamp
In Decem ber 2019, BNM issued a draft on the duty remissions in 2020 Budget
licensing fram ework for digital banks, with the For resident individuals, a new chargeable incom e
objective to prom ote financial inclusion and im prove band has been introduced, such that the high incom e
financial literacy. It also publicised its intention to earners with the chargeable incom e exceeding RM2
issue five digital banking licences, thereby allowing m illion will be taxed at a higher rate of 30 percent
licence holders to conduct either conventional or (previously 28 percent).
Islam ic banking in Malaysia.154
Stam p duty (50 percent) is also now chargeable on all
• However, considering the strict capital the instrum ents of transfer between parents and
requirem ents and lengthy process under this new children (by way of love or affection), but only where
fram ework, several existing banks are enhancing the recipient is a Malaysian citizen.
their digital banking capabilities with varying
operating m odels, in response to the potential • Earlier, rem ission was applied regardless of
disruption of future neo-banks in the system . whether the parents and children are Malaysian
citizens or non-citizens.

E-wallets to distribute capital market

products
In May 2020, The Securities Com m ission of Malaysia
allowed operators of e-wallet or e-paym ent
applications to partner with capital m arkets services
licence holders and distribute capital m arket products
directly to users.155

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 Malaysia

Opportunities for WealthTechs as traditional players lag in innovative

wealth management solutions

Growing digitisation but vast scope to Low trust levels and higher advisory fee
improve digital offerings driving interest towards WealthTechs
With strong internet and sm artphone penetration and and alternative assets
the governm ent’s push to accelerate digitisation, Investors in Malaysia have low levels of trust in the
banks in Malaysia have increased their tech spend to wealth m anagem ent industry, prim arily due to a
develop advanced wealth m anagem ent products for dearth of high-quality advisory talent. Moreover, the
an enhanced digital custom er experience. existing products provided by wealth m anagers com e
• These include offering portfolio dashboards, with high advisory fee that do not deliver the
financial planning, regular research/m arket insights expected returns.
and portfolio m anagem ent. As a result, WealthTech platform s have been
However, there is still plenty of room to expand the benefiting from this dissatisfaction, as they are able
range as well as level of custom isation in these to attract m ore custom ers by offering low-cost digital
investm ent products and solutions. The existing investm ent solutions with the option to diversify their
offerings are lim ited to structured products, foreign investm ent over the range of international securities.
exchange-related instrum ents and unit trust funds Moreover, alternate investm ent asset classes such as
which can further be tailored as per the needs of the ECF and P2P are gaining interest, as they provide a
clients. Also, there is a scope to expand digital trading better diversification and risk to reward opportunities.
capabilities for different instrum ents across
international m arkets.

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 Malaysia

Comparison of digital capabilities and offerings by leading players for HNW clients
In Malaysia, WealthTechs are leading in term s of offering different digital capabilities to their custom ers. Most of the
traditional banks provide in-person advisory services rather than providing algorithm -driven investm ent solutions,
whereas WealthTechs are well-advanced in leveraging AI, Big Data and robo-advisory. Also, international players such
as SCB are way ahead of dom estic banks in term s of offering digital services.

Hong Stash
Digital capabilities Maybank CIMB SCB Citi HSBC MyTheo i-Wealth Algebra
Leong Away
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
✔ ✔ ✔ ✔ ✔ ✔ ✔
Customer Features

research and insights

Portfolio management ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔ ✔ ✔ ✔

Digital account opening ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

Financial planning,
analysis, goal and ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
investment tracking
FX trading
Digital execution

Equity trading ✔ ✔ ✔ ✔ ✔
Fixed Income trading
Structured Product
booking ✔

Funds (ETF) trading ✔ ✔ ✔ ✔

IPO subscription ✔ ✔
Robo-advisory ✔ ✔ ✔
solution
Internal

Big Data analytics ✔ ✔ ✔ ✔

Digital offering to facilitate
client interactions ✔ ✔ ✔ ✔ ✔ ✔

Leading traditional banks Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

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 Malaysia

Banks can focus on digital offerings to meet potential demand for

advisory among HNWls

Recommendations
Given that the Governm ent of Malaysia is actively
prom oting digitisation in banking and capital m arkets,
banks should continue to invest in strengthening their
digital wealth capabilities by leveraging advanced
data-driven technologies and AI.

Since Malaysian HNWIs are conservative with their

savings and investm ents, banks should focus on
educating them about the benefits of long-term
investm ent strategies and wealth m anagem ent
products.
They should also look to com bine their digital and
hum an capabilities with a hybrid robo-advisory m odel
to offer personalised wealth m anagem ent and
advisory solutions, with focus on the Malaysia’s
growing HNW population.
Banks can further work towards collaborating with
digital wallets and FinTechs to enhance their cross-
border rem ittance capabilities and to offer an
enhanced custom er experience.

Moreover, with the growing popularity of alternate

investm ent options, banks m ay want to explore
introducing services that look into such asset classes
that cater to the dem and for diversification am ong
investors.
They can also plan to provide digital trading options in
equities, fixed incom e and FX securities to their
clients across m ore international m arkets.

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 Malaysia

Leading players and their digital

wealth management offerings

Leading traditional banks

Maybank CIMB

Descrip tion Descrip tion

• One of the largest banks in Malaysia with a strong • Largest Private Bank in Malaysia with ~US$12
focus on digital transform ation billion of AUM in the dom estic m arket
• Continue to build and strengthen its asset • First bank in Malaysia to receive Bank Negara’s
m anagem ent business by launching innovative regulatory sandbox approval for electronic-know
conventional and Islam ic products and expanding your custom er (e-KYC)
third-party distribution channels across m arkets
• Launched first Big Data platform in Malaysia,
• Launched Sm ile m obile app, that enables using open-source software and supported by a
custom ers to access their insurance policy details, data science centre of excellence
panel of service providers, subm it claim s and
• CIMB Private Banking service offers custom ised
receive inform ation to facilitate inform ed decision-
advisory, portfolio planning and wealth
m aking
m anagem ent solutions for HNWIs
• Maybank Private and Maybank Prem ier provide a
suite of services tailored to m eet clients’ daily
banking needs as well as longer-term investm ent
goals

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Mayb ank Wealth ap p , em powers affluent • Clicks Trader, offers online trading conveniences
custom ers to m anage their finances by providing a to help grow investm ents via CIMB Clicks m obile
consolidated view of their product holdings; helps app
them evaluate, analyse and understand their
financial and investm ent status • Launched sep arately managed accounts
(SMA), a discretionary portfolio platform , that
• Offers online will writing through its digital provides investors access to investm ent
banking platform , Maybank2u strategies from global asset m anagers and help
them invest in global stocks through a m ulti-
• Rolled out M2U Live Chat, a real-tim e platform
currency strategy
for prem ier banking custom ers to seek assistance
via Maybank2u and Maybank m obile app 24/7
• First local bank in Malaysia to introduce SWIFT
Glob al Payments Innovation (GPI) that enables
speedier, m ore convenient and secure cross-
border rem ittances
• Mayb ank Trade enhanced its engagem ent
platform to develop predictive custom er behaviour
analytics capabilities as well as im plem ented
biom etrics login for faster and m ore secure
transactions

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 Malaysia

Leading players and their digital

wealth management offerings

Leading traditional banks

Hong Leong Bank Standard Chartered Bank (SCB)

Descrip tion Descrip tion

• Fifth largest lender in Malaysia with strong focus • One of the leading international banks in Malaysia
on digital transform ation
• First international bank to set up an Islam ic
• First bank in Malaysia to offer a com pletely digital banking arm and to launch Islam ic products
onboarding experience
• Best Islam ic Digital Bank in Malaysia 2020 by
• Plans to roll out m ore digital reboots and Global Finance for the fourth consecutive year
enhancem ents across all segm ents and spend
• First bank in Malaysia to offer secured wealth
about RM130 m illion on expanding its digital
lending in foreign currencies
initiatives in 2020-21
• First bank in Malaysia to offer banking through
video, audio and chat for the Personal and Priority
Banking segm ents

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• HLeBroking, allows custom ers to trade in foreign • Smart Direct, where investors can transact in
stock m arkets including Singapore, US, Australia over 250 m utual funds from various foreign
and HK via an online platform currencies and track their portfolio perform ance
online via SC Mobile app
• BURSA Trading, offers online trading facility In
local m arket via m obile app • Smart Goals, to achieve financial goals
custom ised to suit investors’ needs and
• HLeChart, real-tim e charting for m arket
investm ent style, i.e., duration, initial investm ent,
analysis
m onthly com m itm ent and risk appetite
• EquitiesTracker provides m arket insights,
• Wealth Power, allows investors to invest into
analysis and tracking by independent equities
bonds, unit trusts, structured investm ents and
research portal
insurance products for higher potential returns,
traded in seven foreign currencies

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 Malaysia

Leading players and their digital

wealth management offerings

Leading traditional banks

Citi

Descrip tion

• Operational in Malaysia since 1959

• Market leader in term s credit cards and a
dom inant share in wealth m anagem ent

• Set-up digital branches to provide clients a suite of

digital-only self-service channels m odelled on
Citi’s Sm art Banking strategy
• CITI Mobile app, provide sim pler, faster and safer
way of banking with greater flexibility and
personalised views

Digital offerings in wealth management and

p rivate b anking or for affluent clients
• Total wealth advisor, enables custom er to
visualise and confirm goals from tim e to tim e,
calculate the cost estim ate for goals and track and
work towards financial goals
• Offers wide range of investm ent products
including retail bonds, unit trusts, m arket-linked
investm ent to dual currency accounts that can be
m anaged online
• Provides research on global and local financial
m arkets to help address investm ent needs

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 Malaysia

Leading players and their digital

wealth management offerings

Leading traditional banks

HSBC

Descrip tion Digital offerings in wealth management and

p rivate b anking or for affluent clients
• HSBC Prem ier offers wealth m anagem ent
solutions that addresses individual needs • Allows digital account onb oarding to its
custom ers
• More focused on providing in-person assistance
• Trade Transaction Tracker on HSBCnet,
• FPX, an online paym ent gateway that enables its
provides real-tim e access to trade transactions on
clients to pay for their online purchases hassle-
m obile
free and in real-tim e
• Wealth Dashb oard, an online wealth
• NetPlus helps to understand the latest
m anagem ent platform , allows access to m onitor
cybersecurity threats and provides fraud
funds, and provides up-to-date news and updates
awareness inform ation
related to investm ents
• HSBC Am anah allows investors to invest in equity
• Glob al Transfers feature in m obile banking allows
m arkets in com pliance with Shariah (Islam ic law)
instant m oney transfers to other HSBC accounts
and cross-border foreign currency fund transfers
(in seconds)

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 Malaysia

Leading players and their digital

wealth management offerings

Leading wealth management platforms

MyTheo i-Wealth

• A digital investm ent m anagem ent platform that • An online wealth m anagem ent m obile application
autom atically creates, m aintains and optim ises the that leverages a robo-advisory solution to
investm ent portfolio based on client’s profile and seam lessly integrate hum an advisory services
risk appetite with FinTech innovation to deliver personalised
wealth m anagem ent solutions at low cost, hereby
• The algorithm reviews the investm ent asset
rem oving the barriers to investm ent m anagem ent
com position of the functional portfolios
and portfolios that were traditionally reserved for
regularly to optim ise returns and rebalances
HNW investors
portfolio autom atically based on m arket
m ovem ents • Provides access to personalised financial
docum ents such as incom e and expense
• Invests in over 25 ETFs globally listed in the US
statem ent, balance sheet and strategic asset
m arket to reduce the overall risks of the portfolio
allocation statem ent in an organised m anner,
allows financial health check, provides a tailor-
m ade roadm ap to financial freedom and a custom -
m ade action plan with strategies to achieve it
• Conducts online consultation sessions with a
dedicated wealth m anager

Algebra StashAway

• A robo-advisory solution that com bines financial • A digital wealth m anagem ent service provider that
advice with very high quality asset m anagem ent com bines personalised wealth m anagem ent and
solutions, norm ally available only to HNWIs financial planning services through its data-driven
through hedge funds and fam ily offices investm ent fram ework to offer globally-diversified
portfolios
• Offers a wider range of investm ents and asset
classes, including Shariah-com pliant and non- • Platform analyses financial assets, investm ent
Shariah com pliant investm ent options, and tools tim e horizon, and risk preferences to
such as education planning and financial planning personalise custom er’s portfolio through a
that are autom atically incorporated in a risk system atic asset allocation strategy
weighted portfolio to achieve desired goals
• Launched an SGX-traded incom e-generating
• Invests m ajorly in iShares ETFs and stocks listed portfolio that aim s to provide investors with an
on the S&P 500 index incom e of 3.75 percent and capital appreciation of
4.4 percent annually; the portfolio was listed
am ong the top 10 new funds in 3Q19 by Citywire
Asia

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 Indonesia

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 Indonesia

Despite an unequal distribution of income and wealth, strong growth

in UHNWIs and e-wallet payments

Growing internet penetration

With an internet penetration of 68 percent, Indonesia has over 185 m illion internet users who are heavily concentrated
in Jakarta and secondary cities in Java and Sum atra.156
According to a survey by the Association for Internet Service Providers in Indonesia (APJII), internet penetration is 72
% percent in urban areas, 50 percent in rural-urban areas and 48 percent in rural areas.157
Mobile internet usage is also undergoing double-digit growth rates and currently stands at over 61 percent am ong the
population.158

68%
Internet penetration in
60%
Smartphone penetration,
Indonesia, with a total of well above the Asia
185 million internet users in Pacific’s average
July 2020, as compared with penetration rate of 51
64 percent in January percent16 0
202015 9

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 Indonesia

Rise in digital payment transactions Growing UHNWIs, but preference for

via wallets liquid assets
The increasing availability of sm artphones in the According to the Knight Frank Wealth Report
m arket, growing adoption of digital channels 2020, Indonesia is ranked 45 th globally in term s of
and the governm ent’s financial inclusion efforts UHNWI population and is further expected to
have created room for the digital paym ents grow by 57 percent over the next five years, the
system to grow at a rapid pace in the m arket. second-highest increase in Southeast Asia and the
fifth-highest increase in the world.163
The rise of affluent individuals is expected to be
Total transaction value driven by increasing em ploym ent levels, strong
in digital payments predicted retail investm ent growth and the

~$36B projected by 2020 —

expected to grow at
CAGR of 15.7 percent
governm ent’s regulatory reform s aim ed at
boosting investm ents.

between 2020–24161 People with over US$1

million in investable

e-Wallet paym ents have grown significantly,

~21K assets (including their
primary residence);
expected to grow to
with GoPay, OVO, DANA, LinkAja, and Jenius ~33,000 by 202416 4
being the top five e-wallet platform s (based on
m onthly active users from 2017-19).
In term s of investm ent preferences, Indonesian
As of February 2020, 41 licensed e-wallet HNWIs are very conservative and prefer to hold
platform s have been approved by the the m ajority of their investm ents (89.9 percent) in
governm ent.162 liquid assets such as equities, m utual funds,
• This num ber is expected to grow with the deposits and bonds. However, deposits rem ain
entry of m ainland Chinese paym ent service the top choice am ong retail investors, accounting
provider, AliPay, in partnership with Bank for two-thirds of total liquid retail savings and
Mandiri and BRI. investm ents in 2018.
This brings opportunity for the wealth m anagers
to invest widely in liquid assets for their HNW
clients and provides a scope for them to educate
these clients to increase their investm ents in
other assets as well.

Large unbanked population; high

inequality in distribution of wealth
About m ore than half of the Indonesia’s
population is unbanked or do not have access to
financial services.
Moreover, about 82 percent of the adult
population in Indonesia has wealth of less than
US$10,000 and the share of the top one percent
in the total household wealth is 45 percent, which
is significantly higher by international standards.165
• The growth of wealth in the next five years is
also particularly pronounced in the higher
wealth bands, with the num ber of investors
with liquid assets of US$3–10 m illion and
US$10m + forecast to grow at average annual
growth rates of 10.1 percent and 9.3 percent,
respectively, depicting the striking wealth
inequality present in the Indonesia.166
This creates a wide range of opportunities for
financial services to capture this huge untapped
population and provide new offerings while
keeping a strong focus on prom oting financial
inclusion.

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 Indonesia

Leading market for Islamic financing, with rising tech spend and focus
on cross-border capabilities

HNWIs still prefer offshore wealth Opportunities for Islamic wealth

management; onshore wealth management products
business being taken up by banks with Indonesia has been a slow starter in Islam ic finance.
retail presence However, in the past few years, the m ass affluent
segm ent has developed a strong preference for
HNW and UHNW clients in the Indonesian m arket
Shariah com pliant/Islam ic banking. This has been
still have a strong preference for offshore banking,
further propelled by the initiatives taken by Shariah
and with well established wealth m anagem ent
Financial Com m ittee to support Islam ic finance,
services in regional location such as Singapore,
including a partnership with Malaysia to strengthen
there are lim ited growth opportunities for onshore
its position as the largest Muslim m arkets in
wealth m anagem ent in Indonesia.
Southeast Asia.
The Indonesian onshore wealth m anagem ent
The com m ittee has also planned to digitise Shariah
m arket, however, is also em erging as an attractive
financial services, including a digital zakat platform
proposition, especially being picked by banks that
and a Shariah com pliant e-wallet. This would cater
already have a retail presence.
to the needs of the m ass affluent segm ent of
This is m ainly driven by the governm ent’s tax Indonesian wealth m anagem ent m arket, resulting in
am nesty program m e of 2017 which pledged m ore opportunities for banks to offer Islam ic wealth
repatriation of offshore assets back to Indonesia, m anagem ent through digital platform s.
driving flows of US$6 billion out of Singapore alone
in 2018.167
Capitalising on this opportunity, som e of the already Improve clients experience through
established foreign banks such as BNP Paribas and digitisation
OCBC have launched their onshore wealth
The Indonesian wealth m anagem ent m arket has
m anagem ent and onshore private banking
largely been based on a m anual and paper-based
businesses respectively, particularly to attract the
process. Internal system s at m ost local banks are
m ass affluent custom ers.
still lagging and m any internal product team s do not
have sophisticated tools to create custom ised
m andates, conduct back testing efficiently and offer
Banks partnering with digital wallet analytics to their custom ers in a visually appealing
players while catering to mass affluent yet insightful m anner.
segment Banks have been taking steps to enhance investors’
Banks in Indonesia are either introducing their own experience, one of which includes digitising the
paym ent wallets or partnering with digital wallet entire investm ent advisory process on portable
players to com pete with the existing leaders in this devices such as iPads and ensuring the investm ent
m arket and the em erging agile FinTech firm s. risk ratings correspond with investors’ risk appetite.

• Launched in 2016, Bank Tabungan Pensiunan

Nasional’s e-paym ent wallet Jenius saw its
users reach 1.6 m illion by June 2019, a 130
percent increase from June 2018.168
• Several other banks have introduced their own
wallets, such as Go Mobile by CIMB and Sakuku
by BCA, to com pete with other e-wallet
platform s in the m arket.
• In January 2020, CIMB Niaga collaborated with
WeChatPay, giving entry to the first foreign
paym ent service provider to operate in the
m arket.

The attractive rebate m echanism s, reduced cost

benefit and convenience offered by these wallets is
expected to pave way for strong custom er loyalty in
m ass affluent segm ent and set foundation for these
wallets to provide other financial offerings, such as
loans and investm ents, to give tough com petition to
traditional banks.

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 Indonesia

Government promoting digitisation with a focus on governance and

consumer protection

In recent years, Indonesian regulators have been trying to achieve balance between innovation
and maintaining regulatory guidelines that ensure consumer protection. While the Central Bank is
focusing on strengthening the payment system, the Financial Services Authority of Indonesia
(Otoritas Jasa Keuangan or OJK) has been introducing laws to support FinTech growth and
digitisation, providing FinTechs and banks with ample opportunities to expand their digital
capabilities.

Revamping the payments landscape Allowing digital banking services

In May 2019, Bank Indonesia introduced a blueprint In August 2018, the OJK perm itted com m ercial banks
for 2025 Paym ent System . It aim s to prom ote to provide digital banking services through distribution
digitalisation in banking and interlink FinTechs with channels.
the banking sector, as well as to balance innovation
• There has been a rise in the num ber of digital
and consum er protection, and safeguard national
banking service providers —such as BTPN Jenius,
interests in cross-border transactions. The Blueprint
DBS Digibank, Senyum ku Am ar Bank— but the
covers five initiatives:
authority to provide such services is lim ited to
• Modernising retail paym ent infrastructure with conventional banks.
integrated paym ent interfaces. For instance;
• The regulatory body has m ade a disclosure
adopting national paym ent gateway BI-FAST for all
regarding fully virtual banks, but the form al
transactions
fram ework is yet to be drafted.
• Strengthening the existing m oney m arket
In January 2017, the OJK directed banks to set up
infrastructure
digital branches to facilitate digital banking
• Developing a data m anagem ent infrastructure by transactions. However, the authority was lim ited to
establishing a digital paym ent ID system and a the banks that had digital banking capabilities.
paym ent data collection hub
• Revam ping form al fram ework to create m ore
structured, adaptive and futuristic paym ent
ecosystem
• Standardised im plem entation of Open Banking

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 Indonesia

Increased collaborations with regulatory Balanced approach to promote FinTech

bodies to promote FinTechs’ growth
development In Septem ber 2018, the OJK announced Digital
In August 2020, the OJK signed a financial technology Financial Innovation rules that focus on supervising
cooperation agreem ent with the Securities FinTechs to m axim ise gains from the growing sector.
Com m ission of Malaysia (SC) to establish a The idea is to create innovations that are responsible,
fram ework that prom otes developm ent of a FinTech prioritise consum er protection, and have well-
ecosystem . Since 2017, the SC has established m anaged risks. They also intend to support
agreem ents with six global regulators such as the innovative, fast, cheap and easy financial services and
Hong Kong Securities and Futures Com m ission, the increase financial inclusion.
Monetary Authority of Singapore and the Australian • OJK launched an online registration system –
Securities and Investm ents Com m ission. Electronic Gateway for Digital Finance Inform ation
System s – to create an efficient way to m onitor
FinTechs’ developm ent.
• It also established a Regulatory Sandbox, a testing
m echanism for products and services developed
by FinTechs, facilitating interactions between the
providers and m onitoring developm ent and
product evaluation before launch.

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 Indonesia

Opportunities for foreign players as domestic players lag in offering

digital wealth management services

Rise in foreign players entering the Opportunities for new digital financial
market service offerings
The total m ass affluent population in Indonesia has Indonesia presents one of the largest opportunities
been rising in the past few years. To capitalise on this for new digital financial services offerings in
opportunity, foreign (global and Asian) banks and Southeast Asia, due to the high proportion of
wealth m anagem ent firm s are setting up operations unbanked citizens along with a growing internet
in Indonesia. penetration.
• In Septem ber 2019, Singapore-based UOB Sensing this opportunity, m ulti-service tech platform s
acquired a 75 percent stake in Jakarta- and e-com m erce players such as Gojek, Bukalapak
headquartered PG Asset Managem ent. and Tokopedia have started offering investm ent
products on their platform s, as consum ers spend
• In April 2019, Lom bard Odier form ed a strategic
m ost of their tim e on these platform s.
partnership with Bank Mandiri to develop its
private banking arm through investm ent and To com bat this rising trend and to cater the ever-
fam ily services. growing dem ands from increasingly sophisticated
HNWIs, traditional banks should also focus on
Moreover, dom estic banks have relatively less
building digital wealth capabilities such as dedicated
developed offshore infrastructure, leading to players
wealth m anagem ent platform s, robo-advisory, invest
such as DBS, Citi and OCBC to act as one-stop shops
in technologies like cloud services and Big Data
for offshore banking needs.
analytics, and partner with em erging FinTechs to
reach new and young custom ers.

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 Indonesia

Comparison of digital capabilities and offerings by leading players for HNW clients
In Indonesia, foreign players (global and Asian) are far ahead of dom estic banks when it com es to offering digital
services in wealth m anagem ent. They are capitalising on their already existing digital capabilities to provide services in
Indonesia. However, dom estic banks are planning to enhance their digital capabilities in the near future, especially by
leveraging data analytics to offer suitable service solutions that fit custom er profiles and needs.

Digital capabilities Bank Mandiri BCA Citi DBS HSBC SCB Halofina
Portfolio statements view ✔ ✔ ✔ ✔ ✔ ✔
Access to investment
Customer Features

research and insights ✔ ✔ ✔

Portfolio management ✔ ✔ ✔ ✔ ✔
Portfolio recommendation
based on risk appetite ✔

Digital account opening ✔ ✔ ✔ ✔

Financial planning, analysis,
goal and investment tracking ✔ ✔ ✔

FX trading ✔ ✔
Digital execution

Equity trading
Fixed Income trading ✔ ✔
Structured product booking
Funds (ETF) trading ✔ ✔ ✔
IPO subscription ✔
Robo-advisory ✔
solution
Internal

Big Data analytics

Digital offering to facilitate
client interactions ✔ ✔

Leading traditional banks Leading wealth m anagement platforms

Source: KPMG analysis based on data from company websites and annual reports

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 Indonesia

Banks should focus on partnering with digital wallets and launching

their own robo-advisory wealth solutions

Recommendations
Banks should continue to invest in technology and
wealth capabilities by launching new digital products
and services that leverage advanced data-driven
technologies such as AI and Big Data analytics,
targeting the growing m ass affluent and HNW clients
in Indonesia.

They can also look at collaborating with firm s offering

digital wallets or digital platform s to deliver Islam ic
wealth m anagem ent products, particularly targeting
the m ass affluent segm ent.
Banks should also look to com bine digital and hum an
capabilities to cater to the growing dem and of
sophisticated HNWIs in Indonesia for liquid
investm ents over long-term wealth. The hybrid robo-
advisory m odel will allow investm ent advisors and
relationship m anagers to provide a personal touch in
financial advice while educating the HNW clients
about the benefits of longer-term investm ents.

Banks can also plan to provide digital trading options

to their clients and expand trading across international
m arkets.

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 Indonesia

Leading players and their digital

wealth management offerings

Leading traditional banks

Bank Mandiri Bank Central Asia (BCA)

Descrip tion Descrip tion

• Largest banking group in Indonesia in term s of • One of the leading banks in Indonesia
assets, loans and deposits
• Offers Virtual Assistant (VIRA) to provide financial
• Em bracing digital transform ation through the services using chatbot technology and m achine
deploym ent of cloud and AI technologies in learning
partnership with Microsoft
• Offers Priority banking for prem ium clients, and
• Added Mandiri Intelligence Assistant (MITA) launched BCA Solitaire for HNWIs
feature, a chat application-based inform ation
• Both services carry prem ium benefits such as
service for various custom er groups, especially
exclusive banking products and services,
m illennials
com m unication platform s, and special,
• Offers Priority Banking Services that provide dedicated branches and lounges
special services and independent Priority
Relationship Managers to align financial growth
with clients’ portfolio

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Bank lags behind in digital revolution on wealth • Launched wealth m anagem ent BCA ap p lication,
m anagem ent; planning to develop a platform for WELMA, that facilitates investm ent product
core banking wealth m anagem ent along with purchases such as m utual funds and bonds, as
building capabilities for digital wealth solutions well as for education on insurance, via m obile
device
• Selected the Avaloq Banking Suite from Swiss
com pany that develops and provides software for • Plans to enhance the analytics capabilities of its
core banking, to run its US$14 billion AUM wealth relationship m anagers to provide suitable service
m anagem ent division solutions that fit custom er profiles and needs
• Focus on developing data analytics and digital-
based functionality to support wealth
m anagem ent service applications

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 Indonesia

Leading players and their digital

wealth management offerings

Leading traditional banks

Citi DBS

Descrip tion Descrip tion

• One of the largest foreign banks in Indonesia in • One of the m ore digitally advanced banks
term s of asset size operating in the local m arket
• Focus on delivering im proved custom er • Focus on developing technological innovations, by
experience by using innovation and digitisation; presenting a variety of financial services in the
continues to deliver a m obile-first m indset Digibank application, ranging from rem ittances to
wealth m anagem ent that can be accessed
• Citi Priority services provide a suite of services
anywhere and anytim e
and product offerings tailored to m eet clients’
wealth goals • Offers full suite of wealth capabilities to clients
spanning their business needs, fam ily legacy
planning and cross-generational wealth
m anagem ent
• DBS Treasures and DBS Treasures Private Client
offers personalised investm ents and wealth
advisory services to affluent clients

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• Im plem ented Total Wealth Advisory, allowing • Digib ank, a m obile application, allows access to a
custom ers to perform top-up, switching and range of digital banking services, from m anaging
redem ption of the investm ent accounts, and funds to growing funds
update risk profiles through online channels
• Features include daily transactions, wealth
• Wealth Management advisory p latform, assists m anagem ent, wealth developm ent and wealth
clients by providing a better understanding of their control using e-statem ents
financial needs, and accordingly strategise
• Launched two new wealth products on its
investm ent plans and m anage wealth
Digibank platform :
• Launched InvestIQ on its Wealth platform to
• Rekening Valas which is a m ulti-currency
enable clients to better understand how their
account which provides 10 different currencies
personality could im pact their investm ents
to the bank’s clients
• Launched ‘Citigold On Your Terms’, which offers
• Ob ligasi Pasar Sekunder, a secondary bond
wealth m anagem ent services through digital
service, the first to be introduced by DBS in
banking services and financial solutions tailored
the region
specifically to custom er aspirations
• Planning to launch m ore new products, such as
online unit trust and a refreshed look-and-feel for
the Digibank application

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 Indonesia

Leading players and their digital

wealth management offerings

Leading traditional banks

HSBC Standard Chartered Bank (SCB)

Descrip tion Descrip tion

• One of the largest banks in the m arket with an • A leading foreign bank in Indonesia
extensive dom estic presence as well as the
• Offers m obile banking, online banking, video
largest global network
banking and SMS banking services to its
• Focus on continuously developing and offering custom ers
digital banking capabilities to its wealth
• Plans to deliver targeted offerings to leverage
m anagem ent clients
opportunities in additions Indonesia’s high-growth
• HSBC Prem ier and Jade offer banking products m arkets
and services specifically designed to suit banking
• Priority Private offers a suite of personalised
needs and habits of affluent clients
wealth solutions with exclusive privileges to
affluent clients
• Straight2Bank onboarding portal allows digital
account opening

Digital offerings in wealth management and Digital offerings in wealth management and
p rivate b anking or for affluent clients p rivate b anking or for affluent clients
• HSBC Internet Banking offers investm ent • SC Mob ile ap p allows users to access and
features for forex accounts, deposit account m onitor their Mutual Fund portfolio perform ance
opening, m utual fund m anagem ent, instant online
foreign exchange transfer, and portfolio
m anagem ent, along with a feature for e-SBN
transactions
• Wealth Dashb oard, an online wealth
m anagem ent platform with features such as
portfolio overview, perform ance analysis,
transaction history, watchlist product and daily
m arket update along with evaluation of portfolio
returns

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 Indonesia

Leading players and their digital

wealth management offerings

Leading wealth management platform

Halofina

• A digital financial advisory and wealth

m anagem ent application that helps investors plan
their financial goals and receive investm ent
strategy recom m endations using AI
• Application provides various services ranging from
financial planning, tracking, saving, investing for
future financial goals, to financial consulting with
professional financial consultants
• Partnered with peer-to-peer lending platform s and
m arketplaces to invest in m utual funds and gold
• Equipped with sm art robo-advisory technology
that provides investm ent recom m endations
autom atically based on the results of analysis of
the financial objectives and risk profile of each
user

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 Indonesia

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 Vietnam

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 Vietnam

Improving IT infrastructure, adoption of digital payment channels and

a growing HNWI population

Improving IT infrastructure and internet penetration

Vietnam witnessed a 10 percent increase in internet users — about 6.2 m illion new users were added — between
2019-20.169 Overall, Vietnam ’s IT infrastructure is gaining strength supported by governm ent initiatives focused at
im proving internet coverage and speed.

%
70%
Internet penetration in Vietnam, with a total of 68.2 million internet
users in January 2020170

45%
Smartphone penetration in 2019, below the regional average
penetration rate of 51 percent171

#2
In terms of internet speed in Southeast Asia, only behind Singapore172

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 Vietnam

Shift towards online payments and Growing HNW population

digital wallets According to the Knight Frank Wealth Report
Rising sm artphone penetration, strong internet 2020, Vietnam is expected to witness one of the
access and high adoption rate for digital highest growths globally in its HNWI population,
paym ent channels coupled with the reaching 42,324 in 2024, m aking it the second-
governm ent’s initiatives to develop a cashless largest HNWI m arket in Southeast Asia.176
paym ent landscape have stim ulated the growth
of paym ents system s in the m arket. People with net worth
over US$1 million
Total transaction value
in digital payments ~26K (including their primary
residence); expected to
$8.6B projected by 2020;
expected to reach
US$14.9 billion by
grow 65 percent during
2019-24177

2024173
Growth expected in
Mobile point of sale
payments projected
64% UHNWI population during
2019–24 to reach 753

$1.6B by 2020 — expected

to reach US$3.7 billion
from 458 in 2019178

by 2024174 Vietnam ’s HNWIs prefer real estate as the first

choice for investm ent, followed by fixed deposits,
gold, stocks and local cash m arkets, reflecting a
potential opportunity for wealth m anagers to
Vietnam ’s paym ent landscape has been prom ote various solutions tailored to cater to
evolving rapidly and according to a report by specific client needs and behaviour.
digital banking platform Backbase, its m obile
paym ents are expected to increase 400 percent However, Vietnam is witnessing increased
by the end of 2025.175 m igration as m ore HNWIs are opting to m ove to
foreign nations that offer citizenship benefits,
• The m obile paym ent space is dom inated by better civil rights and a better regulatory
five e-wallet service providers — Payoo,
environm ent.
MoMo, SenPay, Moca, and AirPay.

Impact of COVID-19
COVID-19 has acted as a stim ulus to
Encouraged by the government, drive a rapid shift towards online
paym ents.
the Vietnamese people have really
taken to digital payments during • During January–March 2020, total
2020. This is a positive signal that online transaction value and paym ents
experienced a growth of 124 percent
the development of non-cash and 76 percent, respectively.179
payments will go from strength to
strength here in Vietnam.

— Ross Macallister, Lead Partner,

KPMG Vietnam

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 Vietnam

Rising focus on technology and only basic developments in wealth

management market

Increased investment in technology by Wealth management market gaining

banks some momentum
A recent banking survey revealed that about 70 Although the wealth m anagem ent m arket in
percent custom ers in Vietnam believe that current Vietnam is in its nascent stage, it is gradually
banking services still operate on old system s with catching up with its ASEAN counterparts such as
low digital integration.180 However, banks have Thailand and Malaysia. The developing econom y,
actively started investing in technology, specifically growing m iddle-class and rising HNWI population
in m obile channels, branch digitisation and process present im m ense opportunities for wealth
optim isation. m anagers in Vietnam .
• According to a report by International Data According to m arket experts, people are
Corporation and Backbase, Vietnam ’s banking increasingly showing interest in bank-originated
sector is expected to see significant digital wealth m anagem ent business, which has added
transform ation.181 about 75,000 custom ers in the last three years.183
Moreover, they believe a growing affluent class
This increased focus on digitisation is m ainly
that is keen to invest m ore towards their future,
triggered by the shift in consum ers’ preferences
gives a perfect opportunity to prom ote wealth
toward digital channels, evident by the rapidly
m anagem ent services.
increasing digital transactions in the m arket. It has
also been supported by governm ent initiatives to However, there are certain roadblocks in the path
prom ote the developm ent of the non-cash paym ent of wealth m anagers. Vietnam ’s stringent
landscape. regulations on foreign participation ham pers
product developm ent, and the resulting lack of
• The governm ent aim s to reduce Vietnam ’s cash
investm ent options induces investors to focus on
transactions to eight percent of total paym ents
fixed deposits, which are less risky and sim ple to
by 2025. In 2019, cash transaction to total
understand.
paym ent ratio stood at 11.3 percent.182
• Moreover, the high interest rate environm ent
However, there are certain challenges related to
prevents wealth m anagers from achieving
network security, custom er trust and an inadequate
returns above risk-free rates, which m akes
legal fram ework, which are ham pering digital
existing financial instrum ents harder to sell.
transform ation of Vietnam ese banks.
• Previously, there have been m ultiple instances
of cyber-attacks due to which banks have
suffered huge losses. Also, security risks such
as insider frauds, custom er frauds, network
attacks on bank infrastructure, and user data
leakage have been increasing.

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 Vietnam

Government taking initiatives to promote FinTechs, with focus on

developing a cashless payment ecosystem

Vietnam lacks regulations that sufficiently stimulate capital markets activity, leading to slower
growth of the wealth management segment in the market. Its FinTech regulatory landscape is
also in the early stages of development. However, the Vietnamese Government has been
stepping up efforts to put in place the necessary regulatory framework for the adoption of FinTech
legislation and facilitation of the work of technology enablers.

Regulatory framework to promote digital Plan to launch regulatory sandbox for

banking FinTechs
In Decem ber 2019, the governm ent approved “The The governm ent has included FinTech regulatory
Inform ation Technology developm ent strategy of sandbox in m any m asterplans, including the strategy
banking industry in Vietnam until 2025” and with the for developing inform ation technologies in the
vision to im plem ent it com pletely by 2030. banking sector. Currently State Bank of Vietnam
(SBV), under guidance of the governm ent, is set to
In line with this, the State Bank of Vietnam (SBV) has
launch a pilot regulatory sandbox for FinTechs in the
set an action program that includes:
banking sector from 2021.
• Com pleting a legal fram ework for digital
• The seven FinTech areas that are likely to
technology operations and developing the
participate in the sandbox are paym ent, credit,
application of key 4.0 technologies, including e-
P2P lending, custom er identification support, open
KYC, Open API, Big Data, AI, blockchain and cloud
API, tech-based solutions, and other banking
com puting.
support services.
• Through this action plan, the SBV aim s to
• This will enable FinTechs to directly test
achieve its target of 50 percent of banks
innovative products and services in a closely
successfully providing digital banking by 2025
controlled environm ent and reach the end m arket
and 100 percent of banks com pleting the
faster.
digitalisation of traditional banking services by
2030.

In Novem ber 2019, the governm ent released a draft

decree to revise its anti-m oney laundering
regulations, which also allows the financial
institutions to conduct KYC without face-to-face
m eeting with the clients.

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 Vietnam

Measures to bolster non-cash payments Relaxed foreign ownership restrictions

In Septem ber 2019, SBV proposed a Draft Decree to In 2020, the Governm ent of Vietnam increased the
institutionalise electronic m oney, i.e., m obile m oney lim it on foreign ownership in dom estic com panies
as a paym ent instrum ent that will help in ensuring from 30 percent to 49 percent.184
transparency in financial transactions.
• This lim it was one of the prim ary reasons m aking
• The new regulation would provide a legal the banking sector less attractive to foreign
fram ework for m obile m oney businesses run by investors, and this m ove will broaden the
m obile network operators and would allow investm ent scale for foreign investors and will
custom ers without bank accounts to use m obile help boosting the m arket’s econom y.
m oney (which is not the case for e-wallets).

Regulations to strengthen cyber security Restrictions on investing outside

in Vietnam Vietnam
Vietnam ’s new Law on Cyber Security cam e into Local investors from Vietnam are currently not
effect from January 2019, and included provisions on allowed to invest outside of Vietnam . Asset m anagers
data localisation, governm ent control over online are required to get approval from the Ministry of
content, and setting up local offices in the m arket. Investm ent Planning as well as approval from the
Central Bank to send m oney outside Vietnam . This
Under these provisions, both dom estic and foreign
restriction results in lim ited product offerings for the
players providing services in telecom m unication,
investors and slower growth of the wealth
internet and value-added services online are required
m anagem ent segm ent.
to store data of Vietnam ese users in Vietnam .
• This is likely to reduce foreign investm ents as
foreign players will have to increase their costs for
setting up and m aintaining storage facilities in
Vietnam .

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 Vietnam

With incumbents lagging in wealth solutions, market offers growth

opportunities for new entrants

Wealth management in a developing However, looking particularly into HNWIs and

stage UNHWIs, HSBC and SCB are am ong the first foreign
lenders that have leveraged the opportunity in this
In Vietnam , banks are m ore focused on providing m arket segm ent and ventured their own wealth
retail banking services com pared with wealth m anagem ent business.
m anagem ent and private banking. The regulatory
environm ent and the capital m arkets are also not
highly advanced to support the wealth m anagem ent Players at initial stage to offer
players to operate fully into the space. WealthTech solutions
Most banks are inclined toward im proving custom er Since wealth m anagem ent is not as highly developed
experience through support from dedicated in Vietnam as other m arkets in the region, the
relationship m anagers and focus on helping clients existing players here are yet to start offering wide
with som e of the basics of wealth m anagem ent, such variety of different WealthTech solutions and are
as the benefits of personal finance, goals-based m ore focused on providing digital solutions in retail
investing, financial planning, and develop their banking. However, Techcom bank is em erging as a
propositions around that. leading provider of digital wealth m anagem ent with
the launch of its robo-advisory solution and digital
Apart from the banks, fund m anagem ent firm s such
wealth platform s.
as Prestige wealth m anagem ent and Vietnam Asset
Managem ent, are m ore active in this space, although Moreover, in 2020, few m ore players have started
even their wealth m anagem ent solutions are in a collaborating with tech com panies to introduce digital
nascent stage and yet to be as widely popular in the m anagem ent services, for instance:
m arket as in the other m ore advanced m arkets in • In Septem ber 2020, Razer FinTech and Tem pleton
Asia. Asset Managem ent cam e together to develop
digital wealth m anagem ent platform , focusing to
Various foreign players such as BNP Paribas, Citi and
SCB have also entered into this space to cater to the cater the need of youth and m illennial custom ers.
wealth m anagem ent needs. • In July 2020, MB Bank partnered with Tem enos
Infinity Wealth to deliver digital wealth
m anagem ent services to Vietnam ese private
banking custom ers.

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 Vietnam

Comparison of digital capabilities and offerings by leading players for HNW clients

Digital capabilities BIDV Bank MB Bank Techcom SCB HSBC Vietcombank

Portfolio statements view ✔ ✔ ✔

Access to investment
✔
Customer Features

research and insights

Portfolio management ✔
Portfolio recommendation
based on risk appetite

Digital account opening ✔

Financial planning, analysis,
goal and investment tracking ✔

FX trading
Digital execution

Equity trading ✔
Fixed Income trading ✔
Structured Products booking

Funds (ETF) trading ✔

IPO subscription

Robo-advisory ✔
solution
Internal

Big Data analytics

Digital offering to facilitate

client interactions ✔

Leading traditional banks

Source: KPMG analysis based on data from company websites and annual reports

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 Vietnam

Innovative and personalised offerings can enable banks to gain early

movers benefit in a nascent market

Recommendations Given the growing favouritism for digital services in

the Vietnam ese m arket, banks should continue to
Since Vietnam ese investors are m ore inclined invest in technology and wealth capabilities. They can
towards preserving wealth in the form of property launch their own paym ent solution or partner with
investm ents, fixed deposits and gold, banks should existing players to take advantage of rapidly
focus on strengthening their connect with HNW increasing adoption rate for digital paym ent channels.
clients in order to educate them and prom ote wealth Also, banks can launch platform s that allow users to
m anagem ent products. invest and park their excess m oney kept in digital
Banks can introduce m ore innovative and wallets into liquid assets such as overnight funds,
personalised offerings to get an early m over's gold, ETFs, etc.
advantage and capture significant m arket share in Given that there is lack of trust am ong custom ers
Vietnam ’s nascent wealth m anagem ent m arket over the region’s banks’ cyber security capabilities,
where peoples’ interest towards bank-originated foreign banks’ focus should be towards building trust
wealth m anagem ent services is now gaining som e by leveraging their brand im age and their well
m om entum . secured banking environm ent.

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 Vietnam

Leading players and their digital

wealth management offerings

Leading traditional banks

Bank for Investment and Development of Standard Chartered Bank (SCB)

Vietnam (BIDV Bank)
• One of the leading foreign players in Vietnam with
• Leading bank in Vietnam based on total assets a wide range of offline investm ent solutions

• In May 2019, piloted the ‘HNW custom ers’ • Wealth m anagem ent solutions include a wide
advisory service with the investm ent products, range of products including structured
including Private Wealth Managem ent, Retail deposits, foreign exchanges, loans, and
Corporate Bond, I-Invest, and I-Broker apps and m ortgages, facilitated by latest m arket updates
Open-ended Fund Certificate and advice brought to the clients by the
experienced specialists

Military Commercial Joint Stock Bank Techcom Bank

(MB Bank)
• One of the largest banks in Vietnam as m easured
• Fifth largest bank in Vietnam based on total assets by chartered capital

• In February 2020, introduced a wealth • TCInvest, a m odern robo-advisor system uses AI

m anagem ent unit, in association with a Swiss to update the rules of the m arket index and stocks
private bank, Bordier & Cie, to m eet custom ers’ by day of the week
needs related to inheritance and estate planning, • Provides convenient investm ent experience
and insurance and allows securities trading
• Custom ised solutions based on each • TCWealth, an online personal financial consulting
custom er’s unique goal and risk appetite tool, offers a variety of financial goals where users
• In July 2020, the bank integrated with Tem enos can choose and custom ise m ultiple goals to create
Infinity Wealth to bring innovative wealth a personal financial picture
m anagem ent services to investm ents m arket • TCPrice p rice list uses experts’ analysis to
• Tem enos’ cloud-native, API-first technology recom m end investors the appropriate stock
allows MB to be first-to-m arket with portfolio for various investm ent needs
differentiated services for m ass affluent, HNW • TCAnalysis allows investors to track prices and
and UHNW individuals in Vietnam ’s untapped trade stocks
investm ents m arket
• Uses tools and in-depth analysis to support
custom ers in m ulti-dim ensional analysis of
m arkets and stock codes based on AI
m echanism s
• Allows digital account opening facility to the users
of iWealth Investment

• TCBS, its subsidiary, upgraded custom er service

and experience for its wealth clients through e-
KYC, e-Voting, e-Learning system , iXu system and
iWealth chatbot

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 Vietnam

Leading players and their digital

wealth management offerings

Leading traditional banks

HSBC

• One of the leading foreign players in Vietnam

• Prem ier clients receive specialist advice and

financial planning support from a relationship
m anager allowing them to fulfil their financial
goals
• Launched real-tim e inward rem ittance and online
bill paym ent to enhance custom er experience

• Introduced om ni channel collections solution, to

provide m ultiple paym ent options on a single
platform

Vietcom bank

• Recognised as the m ost prestigious com m ercial

bank for foreign trade in Vietnam
• In July 2020 launched digital bank service, VCB
Digibank, integrating the bank’s online trading
platform s. It is based on the com bination of
internet banking and m obile banking platform s
with objective to provide a seam less and unified
experience for custom ers on all types of electronic
devices
• Through Vietcom bank Fund Managem ent —joint
venture between Vietcom bank and Franklin
Tem pleton Investm ents— it provides portfolio
m anagem ent services and investm ent option to
invest in open-ended funds

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 Vietnam

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 Appendix

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 Methodology
This report has been prepared by the Global Clients and
Markets team at KPMG Global Services, India, and is purely
based on the inform ation available in the public dom ain
obtained through secondary research.
It provides a com parison of the leading players operating in
the wealth m anagem ent and private banking space in eight
key m arkets across Asia Pacific, nam ely Singapore, Hong
Kong, m ainland China, India, Australia, Malaysia, Indonesia
and Vietnam . These players have been com pared based on
their digital wealth m anagem ent offerings to understand
the level of advancem ent in each m arket, while the m arkets
have been evaluated on custom er trends, regulatory
environm ent and com petitive landscape in this space, to
identify opportunities across the region in digital wealth
m anagem ent.
The eight m arkets have been ranked on how evolved the
wealth m anagem ent and private banking space is in each
m arket. These rankings are only indicative and have been
based on several factors including digital advancem ents,
the regulatory environm ent, a m acro-econom ic view and
key consum er trends.

Singapore em erged as a clear leader given its highly

advanced infrastructure for wealth m anagem ent (esp.
offshore), strong governm ent support and sophisticated
digital capabilities am ong the players. It is followed by Hong
Kong and m ainland China, with the form er having a well-
developed IT infrastructure and favourable governm ent
initiatives, while the latter has a huge volum e advantage
with rapidly growing m iddle-class as well as HNWIs, but
lags behind in governm ent support and regulatory
environm ent.

Sim ilar to m ainland China, India has a large m ass segm ent
as well as rapidly growing UHNWIs and a boom ing FinTech
space, but has lower overall technology adoption in wealth
m anagem ent. Australia is ranked fifth as despite having a
large m illionaire population, it too has relatively slow
adoption of digital wealth m anagem ent in the country.

Except for Singapore, all Southeast Asian m arkets fall

behind other peers in the list, both in term s of m arket size
and digital wealth m anagem ent adoption. Am ong them ,
Malaysia is witnessing rising tech spend and governm ent
initiatives stim ulating digitisation in banking and capital
m arkets. However, Indonesia and Vietnam still have a long
way to go, as the form er has a large unbanked population
with lim ited digital wealth m anagem ent capabilities,
whereas the latter is m ore focused on digitising retail
banking services.

Digital Wealth Managem ent in Asia Pacific | 140

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 References
P.1
1 Forbes, “North America overtakes Asia Pacific in global wealth race for first time since 2012”, 09 July 2020,
https://www.forbes.com/sites/jamesphillipps/2020/07/09/north-america-overtakes-asia-pacific-in-global-wealth-race-for-first-time-
since-2012-report-says/?sh=6a603f9d3717
2 KPMG internal analysis on outlook survey of CEO’s in Financial Services

P.10
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Digital Wealth Managem ent in Asia Pacific | 142

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Digital Wealth Managem ent in Asia Pacific | 148

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 KPMG Regional
Industry Leaders

Kok Keong Leong Paul McSheaffrey Sam Shi

Partner, Financial Services Lead Partner, B anking Lead Partner, Head of B anking
Singapore Hong Kong (SAR), China China
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Tony Cheung Sanjay Doshi Ian Pollari

Partner, Financial Services Lead Partner, Financial Services Lead Partner, B anking Lead
China India Australia
[email protected] sanjay.doshi@ kpmg.com ipollari@ kpmg.com.au

Ahmad Nasri Ab dul Wahab Liana Lim Tran Dinh Vinh

Partner, B anking and FS Lead Partner, B anking and FS Lead Partner, B anking Lead
Malaysia Indonesia Vietnam
[email protected] Liana.lim@ kpmg.co.id vdtran@ kpmg.com.vn

149 | Digital Wealth Managem ent in Asia Pacific

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150 | Digital Wealth Managem ent in Asia Pacific
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