The Future of Wealth Management in India: How the industry is changing and what to expect

As India’s economy continues to grow and develop, so too has the need for effective wealth management. In recent years, the wealth management industry in India has seen an increase in the number of services offered, new players entering the market, and investments in cutting-edge technology.

The wealth management industry in India is evolving and changing quickly, driven by technological advancements, the increasing sophistication of investors, and the availability of new financial products. In this blog post, we’ll explore how the wealth management industry in India is changing, and what we can expect in the future. We’ll also look at how technology and new products & services such as Investment management platforms are helping to shape the industry and how investors can benefit from these changes. With a better understanding of the current and future state of wealth management in India, investors can be better informed when making decisions about their investments.

Wealth Management
An overview of the current state of the wealth management industry in India

Customers that are exposed to new AIF platforms benefit from a wide range of options as well as affordable pricing. It keeps the industry alive. The industry is currently dominated by traditional providers such as financial institutions, insurance companies, and asset management platforms. In recent years, however, there has been an influx of new players such as digital-first start-ups and independent financial advisors who are disrupting the market and bringing innovative products and services to the table.


    Like Us On Social Media!

    • The industry has experienced tremendous growth over the last decade. The number of domestic millionaires and billionaires is expected to increase further given that the IMF projects that India’s GDP will rank third in the world by 2030. 
    • Also, Boston Consultancy Group projects that India’s financial wealth would reach US$ 5.5 trillion by 2025, growing at a rate of 10% per year. 
    • To compete with their international competitors, Indian wealth management organizations need to modify both their regulations and technology.

    It is clear that the wealth management industry in India is changing rapidly and providing more opportunities for both providers and consumers. With technology playing an increasingly important role in the sector, it is expected that the industry’s landscape will continue to evolve in the coming years.

    The obstacles that the industry faces

    The wealth management industry in India is facing a number of challenges, from rising competition to regulatory changes. With more players entering the market, competition for customers is increasing and leading to higher pressure on fees and services. Additionally, regulations have become increasingly stringent, leading to increased compliance costs and additional scrutiny from regulators. Finally, the pandemic has had a major impact on the industry, leading to an overall decrease in wealth management activity. With an uncertain economic outlook and increased volatility in the markets, investors are often more hesitant to make long-term commitments. This is leading to a decrease in demand for wealth management services, putting further pressure on the industry.

    The opportunities for growth in the industry

    The Indian government’s focus on the development of financial infrastructure and improved regulation of the sector has created an environment conducive to investments and private wealth. The sector has seen increased investments from foreign investors, who are attracted by the growing Indian economy. As a result, investment options have become more diverse, including mutual funds, insurance products, and pension products. Furthermore, technology-driven solutions such as automated services & advisory have emerged as attractive alternatives for investors, giving them access to sophisticated financial advice and portfolio management at a fraction of the cost.

    In addition, the rise of digital banking services has also opened up new opportunities for wealth managers to reach more customers and provide better services. This is especially true for rural and semi-urban areas, where these services were previously not available or affordable. By using digital banking platforms, wealth managers can expand their customer base to areas where they previously could not access potential customers.

    The emergence of fintech companies has also paved the way for tremendous opportunities. Fintech companies are able to offer economical and effective automated services to fund managers and management companies, allowing them to access a range of financial services without needing to hire a bunch of managers.

    Overall, the future looks bright for the wealth management industry in India. With a favorable regulatory environment and increasing investment opportunities, the sector is poised to continue its growth trajectory in the years to come.

    ⇒ The regulatory environment is driving growth

    In recent years, India’s regulatory framework has strengthened, creating new investment opportunities for the general public. People may invest in a wide range of financial products today, from straightforward mutual funds to more complicated ones like PMS and AIFs that provide chances in the private market and hedge funds that use co-lending and peer-to-peer lending as leverage.

    Changes in PMS distribution fees, recent AIF developments affecting PIPE and VC Fund regulations, caps on investments in investee companies, or the introduction of accredited investors are just a few examples of significant steps that have made it simpler for people to invest in complicated instruments. Fair reforms encourage both fund managers and investors to contribute to the development of enduring partnerships between them.

    Fund managers will be able to provide customers with the newest, most innovative products as consumers grow more knowledgeable about the various asset classes and investments they may make.

    Wealth Management
    What to expect from the future of the wealth management industry in India

    Over the next few years, we can expect to see an increased focus on technology and digital solutions, along with more advanced investments in artificial intelligence (AI) and machine learning (ML). The industry is likely to move towards automation, with the increased use of Robo-advisers and other technologies to reduce costs and streamline processes.

    We will also likely see an increase in the number of private wealth management firms in India. These firms will likely be focused on providing customized services to high-net-worth individuals and families, as well as offering specialized products and services tailored to their needs. The demand for more sophisticated and tailored advice is also likely to rise as clients become increasingly knowledgeable about the investment landscape. This will lead to more financial advisors providing clients with personalized advice that takes into account their individual needs and goals.

    We can also expect to see more partnerships between the banking sector, wealth management firms & fintech companies, as FIs look to better serve their clients’ needs by offering them access to a variety of investment options. This may include more collaboration between traditional banks and digital-only wealth management firms.

    In addition, as the Indian government continues to push for greater financial inclusion, there is likely to be an increased focus on educating people about investing and financial planning. This could lead to more demand for financial literacy courses and seminars, as well as more public awareness campaigns about the importance of wealth management.

    Finally, the wealth management industry in India is likely to continue embracing sustainability and socially responsible investing. This means that companies will be focusing on investing in companies that are making positive contributions to society and minimizing the environmental impact of their investments.

    Overall, the future of the wealth management industry in India is looking very positive. With an increased demand for personalized advice, enhanced technology solutions, and an increased focus on sustainability, we can expect to see the industry grow in the coming years.

    About the organization 

    Novel Patterns is headquartered in Noida, U.P., and is an advanced analytics-based fintech organization dealing in B2B business, helping banks and financial institutions streamline their processes across different verticals. 

    Currently, with 65+ customers and an average growth of almost 25%+ month on month, Novel Patterns is expanding globally with exponential growth and leaving footprints all across the globe. We are able to help customers from all around the world, including but not limited to the Middle East, the United States, and the UK region, streamline their processes and enhance the customer experience. More details about the product and organization are available on the company website.