Five tasks that wealth managers can delegate to an algorithm

Five tasks that wealth managers can delegate to an algorithm

Five tasks that wealth managers can delegate to an algorithm

A lot has been said about the threat technology poses to wealth managers, particularly as it erodes the value proposition behind investment management. But a new white paper suggests that technology can also help wealth managers increase their value to clients.

The paper, titled How Digitalization Is Reshaping Wealth Management and published by financial-services technology provider Fiserv, focuses on the potential of robotic process automation (RPA) to drive significant advances in productivity and efficiency for wealth managers.

Rather than being based on actual robots, RPA relies on software to help machines imitate the way people manage and perform tasks. The technology is particularly useful for repetitive tasks, which often involve step-by-step procedures that are implemented in response to specific events, triggers, and scenarios.

“Much like the improvements to manufacturing processes that have taken place over many years, and that have resulted in better efficiency, design and safety, we believe wealth management is now going through this same cycle, mirroring the automation and improvement that has taken place in manufacturing since the late ‘70s and ‘80s,” the paper said.

According to the paper, wealth managers who are considering the use of RPA should examine tasks that rely on structured data and entail manual processes as well as high volumes. More specifically, the technology is most applicable for tasks that are simple, manual, high-volume, content-intensive, have few exceptions, and are prone to human error.

Five specific examples were highlighted:

  • Client onboarding – digital tools integrated with applications to perform e-signatures can efficiently onboard new clients remotely, Fiserv said. A digital process would also be more streamlined as it eliminates the use of hard copies, multiple forms, and re-keying of information.
  • Financial planning/data aggregation – According to the paper, tools that deliver real-time interaction and “what if” scenarios can help create a digital experience for clients. Building financial plans and portfolios interactively and automatic aggregation of client data are just two examples.
  • Trade processing – RPA can automate exception handling so that intelligent alerts are sent based on certain exception criteria. Since it removes the need to manually upload data files to back-office systems, it can improve process quality and process volumes while mitigating human error.
  • Reconciliation – after retrieving data in numerous forms from external parties and internal record-keeping systems, RPA can format the information, compare data sets, and make corrections and adjustments based on defined rules. “Compared to human effort, RPA can retrieve and prepare data sets in many different formats from external parties and compare based on predefined rules,” the paper said.
  • Fund administration/financial reporting – RPA can also do validation checks across different phases of the financial reporting process that are repetitive, rule-based, and prone to human error.


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