There has never been a more interesting time in the banking and wealth management world than now, writes Avaloq CEO Juerg Hunziker. The innovation momentum, largely driven by technology, is fantastic. There are five key elements that financial institutions need to address to be ready for the future.

By Juerg Hunziker, Group Chief Executive Officer at Avaloq

At this year’s Avaloq Community Conference, «Future Ready with Avaloq» was more than just a theme. It evolved to become a full philosophy – a philosophy that is shaped and guided by the evolving needs of the end customer.

As a driver for industry evolution, Avaloq’s «Future Ready» philosophy is upheld by five realities which ensure the needs of the customer always remain front and center. These are:

  • Sustainable digitalization guided by end customer experience
  • Cloud as an avenue for better industry standardization
  • Outsourcing as a long-term strategy and not just a cost-cutting measure
  • Data is king and key to getting to know your client
  • Democratizing wealth management by serving tomorrow’s clients today

Offering Wealth Management Products to a Wider Client Base

Many banks rely on our technology and services on their wealth journey, and working with them, we see that more and more data is produced every day, while an increasing amount of regulations impacts the preparation time for advice. Ultimately, this increases the workload of the relationship manager or advisor and absorbs a lot of time with tasks that do not add much value. Besides, a lot of processes are still following the «paper trail» of the original process. We see a strong need for:

  • Lowering acquisition costs by rethinking the wealth journey – why not start with client segments that need help to grow into the wealth segment?
  • Leveraging new technologies to achieve an insight-driven internal workforce enabling bespoke, but scalable advice through the power of machine learning.
  • Building on the power of an ecosystem – rather than multiple «silo» integrations and bearing the costs of integration.

Succeeding in a New Reality Requires Constant Change

For financial institutions in partnership with Avaloq, being part of the future means a constant and consistent move to safeguarding a part of the future for themselves. In short, this means that there is no one ultimate switch when it comes to technology and meeting customer needs, but instead a steady adoption of consistent change – and a departure from the legacy of keeping things the way they have always seemed to work.

The one given of the future is disruption. Adopting this new reality will mean that banks are well placed to survive and flourish in a world where disruption becomes the new normal.

In essence, these new realities are certified pathways to ensuring banks consistently remain within their customer's orbit. In the words of Martin Luther King Jr: «If you can't fly then run if you can't run then walk, if you can't walk then crawl, but whatever you do you have to keep moving forward.»

Whether flying, running, walking or crawling, the constant movement will become part of the new normal that banks must become accustomed to in the future.

Entering an Area of High Change

Furthermore, the ramping up of blockchain and crypto developments mean the industry is headed for a future where every asset will be bankable. Through tokenization, anything from real estate to art – in whole or in part – will become investable and so there is an impending explosion of assets that institutions will need to manage in order to remain relevant.

Laying the foundation for the digital future is an intrinsic part of Avaloq’s role in the market as a leading platform provider. In terms of front-end digitalization, Avaloq has doubled its client base over the past two years. Among our SaaS/BPaaS clients, the number has even tripled. Financial institutions of all sizes and around the globe rely on our global digitalization processes today – we helped them become «Future Ready».

As we enter an era of high change, Avaloq is proud to stand as a partner for banks in ensuring they win the race. The race is on and banks can surely win it, but first, they have to run it.