The swelling pool of wealthy individuals in the country has spawned a new rush among software providers to deliver wealth management software tailored to their needs.
According to Credit Suisse, wealth in India trebled over the past decade to $3.5 trillion (` lakh crore) and is likely to nearly double from here to $6.4 trillion by 2015. Growth in the wealth management software space is seen keeping pace with this.
Foreign banks are starting to use local software products even as international technology providers wait to enter the country and test the waters.
What was earlier a spreadsheet-format data and report generation is being replaced with better versions, which squeeze the wealthy customer’s profile, portfolio, his goals and the returns generated over a period into a single screen for the wealth manager, or a single-shot view of wealth managed across various wealth managers for customers.
An industry expert said the market of technology for investment and advisory firms was earlier growing at the rate of 50-80%, but now there are firms seeing up to 300% growth.
The betterment of products in the software space is helping wealth managers set up business quickly. Sutapa Banerjee, chief executive officer - private wealth, at Ambit Capital, said “Though the industry is still in a nascent stage, today there is much to chose from than there was eight years ago. There are very few brands in the software business where you can buy off-the-shelf. You have to customise them to your standards, which may take around 7-8 months. But earlier, it used to take longer to do that — may be 1-2 years.”
“The approach of wealth managers is changing after the changes in mutual funds and now Ulips. It is now more relationship-oriented and value driven. Hence, we are looking at solutions where we are able to provide intrinsic value, where there is a combination of research and advice,” said Sandeep Presswala, executive director at Miles Software Solutions, which claims a marketshare of 85% in this segment.
International technology players are also keen on entering the Indian market.
Richa Karpe, director - investments at Altamount Capital, said, “There are some international players who are looking at the Indian market keenly. But they are yet to set up offices in India and are keeping a watch through their Asia offices.”
So what are the wealth managers looking for when it comes to software?
“The solution looks at all asset classes and can help relationship managers get the entire client portfolios on a single platform. It is fairly exhaustive. The key focus is on a holistic single view for the customer that can aggregate all transactions,” said Presswala.
“Even banks that cater to high value customers are willing to look at our solutions.”
However, some players say that the Indian softwares cover only the tip of the iceberg as a product. “They are not as exhaustive as their international counterparts,” said a wealth management official catering to ultra high-networth individuals, on condition of anonymity. In the years to come, that may change.
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