Asset managers have spent a good deal of time and effort over the past few years attempting to streamline their business costs in anticipation of volatile and fragile equity markets.
Investments that would enable growth are high on asset managers’ agendas; with respondents acknowledging that the rise of fintech (disruptive financial technology) firms is an important factor that could influence their growth in the next five years.
Still early days
Mark Pugh, UK asset management leader at PwC, said: “It’s still early days for asset management firms and their interaction with start-up disruptive companies but we are seeing asset managers beginning to put aside money for investment in innovation and fintech.
“However, they remain at the exploration stage and are still getting to grips with how this mountain of start-ups could add value to product offerings, distribution channels, and customer engagement.
“Fintech companies have a huge variety of offerings to the wealth management industry but are still being hampered by regulatory constrictions. Asset managers need to work out how they can best utilise the opportunity these new companies offer and, importantly, begin to work out how to create a business culture in which innovation is incorporated without squashing the entrepreneurial spirit they are investing in,” Pugh said.