OPINION | Reimagining wealth management, a digital-first future ​ 

India’s wealth management landscape is ready for change.

India’s wealth management industry is at a turning point, similar to the changes seen in the UK and US 25 years ago.  With 750 million savers and only 55 million mutual fund investors, there is a huge opportunity to move from saving to investing. ​ The quick rise of fintech brokers, which have captured 36% market share in just five years, shows the growing need for digital-first solutions. ​

The affluent segment, made up of individuals with annual incomes between ₹7 Lakh and ₹1 Crore, represents a $4 trillion market. ​ They focus on building wealth and are becoming more willing to make informed investment choices. However, traditional distribution models are no longer enough. ​ A low-cost, digital-first approach is crucial to effectively serve this segment. ​ New strategies include placing financial planning at the centre, using hybrid delivery models that combine human advisors with digital platforms, and creating intuitive products that meet various investment goals. ​

India is the most digital financial market in the world, and financial service providers must fully take advantage of this. ​Technology allows for personalized solutions at scale, helping digital enablement of advisors while keeping costs down. ​Neobrokers and self-directed investing challenge traditional distribution, forcing incumbents to innovate with their own digital offerings or partner with others. ​

The industry is moving away from single-product offerings to holistic portfolio solutions. ​ For example, fee-based models, with portfolios focused on outcomes and tailored to client needs. ​Asset allocation is now central to client interactions, and wealth portfolios are starting to include more index funds and ETFs. This trend matches global developments, where wealth ETFs and index-managed funds in EMEA are expected to grow from $2.1 trillion in 2023 to $3.2 trillion by 2028

The wealth spectrum in India shows the need for differentiated delivery models:

* Mass Market (<₹7 Lakh): Focused on first-time investors and savings, offered through digital and hybrid models. ​

* Mass Affluent/Affluent (₹7 Lakh–₹1 Crore): Concentrated on wealth building with informed investment choices, supported by digital and personal advisory. ​

* HNI/UHNI (₹1 Crore+): Addressing various goals like retirement, tax planning, and estate management, provided through personalised advice and discretionary management. ​

India’s wealth management industry needs to adopt fee-based advisory, digital tools, and hybrid models to serve a wider range of customers. ​ The shift from saving to investing will be driven by outcome-focused solutions, competitive prices, and technology-enabled personalisation. ​

India’s wealth management landscape is ready for change. By focusing on digital-first solutions, personalised advisory, and portfolio-based offerings, the industry can reach its full potential and empower millions of savers to become investors.