Rich open to tech giants managing wealth
Latest World Wealth Report shows effects of disruption from Big Tech industry
Tech companies like Google, Apple, Facebook and Amazon already rule much of our lives so it is no surprise that many wealthy people are open to them organising their finances too.
Indeed, 56.2 per cent of the well-heeled polled would consider such services from tech giants. Perhaps more tellingly, 81.7 per cent of those amenable to the idea comprise young rich individuals under 40.
Around 72.5 per cent of that 56.2 per cent came from the Asia-Pacific, excluding Japan, noted the annual poll from consulting firm Capgemini, which surveyed around 2,500 high-net-worth individuals in 19 countries.
The findings point to the risks confronting the traditional fund management industry, which could face the same online disruptions that have roiled industries such as travel and retail.
The report looked at those with investable assets of US$1 million (S$1.36 million) or more, excluding items such as their home, and wealth managers.
Capgemini noted: "So far, only a few Big Tech firms such as Alibaba and Amazon have forayed, or signalled an intent to foray, into the business of wealth management in a significant way.
"But the knowledge that they could do so - and do it well - is a threat that looms large over the industry."
Capgemini's Asia wealth management head, Mr David Wilson, said the 56.2 per cent open to such financial management was one of the more surprising points of the survey.
"It is more a case of when we look at the potential of disruption on the horizon.
"Wealth management for many years was relatively calm; you had human-led delivery of wealth management and there wasn't a lot of competition from outside," he added.
"We are seeing now a lot more activity of these so-called Big Tech players, entering and disrupting the industry.
"And if they ever really decide to offer wealth management services at large, that would significantly negatively impact many players in Hong Kong and Singapore."
The number of wealthy people in the Asia-Pacific grew 7.4 per cent - "a modest deceleration from about 9 per cent in 2015" - and their wealth expanded 8.2 per cent last year compared with 2015.
Singapore's wealthy population grew 6 per cent - a rate higher than Hong Kong's - to 109,800 people last year, compared with 103,600 in 2015 and 107,400 in 2014.
Wealthy people across the world voiced two major concerns about tech companies going into wealth management, with 53.6 per cent noting data privacy and security.
FOR MORE, READ THE STRAITS TIMES TODAY