Dubai: Fintech firms are treading to areas where big banks are raring to go: make use of technology in wealth management and minimise cost.
Companies like Singapore-based Weinvest, in which Schroders bought a minority stake for an undisclosed sum, is seeking to set up a base in the Middle East to provide products at client or relationship manager level with the help of technology at the lowest possible cost.
Many banks and asset managers are not in a position to implement this streamlined business model as theirs is a combination of an offshore and onshore business model, creating a space for fintech providers to exploit the opportunity.
“Our platform takes care of the customer front end, takes care of entire technology, takes care of products, operations, and we post it on the cloud in terms of infrastructure. We need risk and compliance, marketing and technology team for integration. So from seven teams, we have reduced that down to three critical teams. We run it almost like a shed service offering like an Amazon cloud infrastructure service,” Bhaskar Prabhakara, founder and chief executive officer at Weinvest, told Gulf News.
Weinvest has launched funds in Singapore at an expense ratio of 50-80 basis points, which is a fraction compared to the traditional asset managers.
They make thematic strategies like investing in US technology leaders, which is a quant algorthimic driven basket, or Yummy, which invest in chocolate, snacks and coffee companies, Singapore real estate, or UK financial industry or Trumponomics among others.
“We have three platforms — Trackwealth, Grow Wealth and Advise Wealth. Weinvest works with banks, and brokerages to give customised solution, and customers benefit on cost front, and variety of products,” Prabhakara said.
Weinvest has teamed up with a large Middle East brokerage, and talking more than 20 banks and asset managers in the GCC. They also plan to launch multiple thematic basket in the local market and also add a Sharia-compliant product line.
Weinvest has clients in Singapore, Malaysia, Thailand, Hong Kong and Indonesia, and the Middle East. Weinvest has 38 employees in India and 12 are in Singapore, where the company is head quartered.
Currently, the company has six clients, which are banks, asset managers, and brokerages, and expects to have 12-14 clients by the end of the year.
The company wants to eye the mass market segment.
“The mass market segment has always been underserved because one relationship manager has about 500 clients, and he cannot do justice with only a maximum of 30-50 clients. All they do is do and buy a fund. Our job is to make wealth management more user friendly and embark upon a simplified journey,” he added.