Since the inception of the digital era, accessing anything and everything has become easier compared to the good old days of manual intervention. Digitization has touched upon various aspects of our lives. It all started with digitizing our social networks, purchase of goods online, transactions on the net, lifestyle enhancements and now our finances too.
A few years back, an investor residing in a small town could not have imagined having access to wealth advisory. He would typically have had his money in a savings bank account or fixed deposit. Digitization has changed this scenario. Companies can now utilize their digital strengths and processes to tap this customer segment which was earlier under the radar and difficult to reach. Technology can help one with a wider geographical reach, providing relevant and unbiased advisory and customer delight, all at the same time.
The government too has played a significant role in digitization through extensive efforts in financial inclusion - spreading financial awareness to the remotest parts of country and bridging geographical difference. Demonetization gave the much needed push to those who were sitting on the fence - whether to go digital or stay offline.
Digitization has been transforming the investment landscape in the following ways:
Information revolution - The internet is replete with information and educative articles highlighting the importance of investing and financial planning. A new investor who is indecisive about whether to and where to invest can get a lot of guidance and take informed decision after comparing various options.
Simple is the new smart - What's making the biggest difference in the life of new investors is the simplification that digitization has introduced. Turn-around-time has reduced dramatically, processes are made paper less and advisory is devoid of any error or bias.
The world is now Mobile First - In today's digital world, smartphones have become our most important gadget - they can do literally everything for us and help us invest anytime and from anywhere. In an endeavor to digitize, various mobile applications became available for easy payments, from monthly bills to bank transactions, or for investing in financial instruments like Mutual Funds, ELSS, Fixed deposits or even pension plans.
E-wallets - E-wallets turned it around to - 'Money in time!' Linking your bank details to the e-wallets makes it easier to transfer the money from one bank account to another. Also, the monthly bills can be paid by just one swipe on your mobile phone. Trading and investing in stocks and bonds has become much easier through robust mobile applications and easier money transfer support.
Artificial Intelligence and Robo-advisory - The most recent innovation in the world of investing is Robo-advisory which is aimed at automating the entire investment advisory process by replacing human intervention. Transparency and error-free unbiased advisory are the hallmark of Robo-investing. An ideal Robo-advisor not only calculates the amount you need to invest for a financial goal, but also decides the asset allocation and investment products for you. Further, it also guides you about the entry into or exit from a particular stock or fund at the appropriate time, unaffected by emotions attached with investment decision making.
I strongly believe wealth creation and investments cannot happen in isolation. It is a journey in which the service providers and investors are equal partners. Companies who are investing in digitization are doing so with two-fold benefit - that of empowering their employees to deliver better solutions to customers and more importantly empowering the customers to take informed decisions with ease.
The author is Head of Personal Wealth Advisory at Edelweiss.