Tapping into wealth

Three years ago, corporate consultant Bhaskar Prabhakara and his wife, Lavanya, were looking for a good source of personal investing advice. To their surprise, they struggled to find an advisory service that could give them what they had in mind. To make a long story short, they and their colleagues created one themselves.

"We have worked in the finance and banking world so we understand the products, but despite all this financial savviness, we found it difficult to get any transparent and well-meaning advisory service," recalls Mr Prabhakara, who is based in Singapore.

"With that in mind, we crafted an experience, as a team, to make it simple so that a person without any financial savviness can join the whole investing journey."

The result was WeInvest, an online platform that gives banks, brokers and wealth managers all the tools they need to present investing information to their clients in a clear, easy-to-understand and precisely targeted way. By matching the right investment products to the right people, it also increases customer satisfaction, leading to more business and fee revenue.

Any person, Mr Prabhakara says, can be overwhelmed with questions when they look at an investment portfolio, so what his company does is try to explain as much as possible via its apps about the financial products that are on offer.

"We can answer questions such as how is this portfolio constructed and what is this portfolio going to achieve for you in the next ten to fifteen years. Typically, these are things that an adviser never tells you," he tells Asia Focus.

Billing itself as "Asia's leading and proven digital wealth service provider", WeInvest began life in Singapore in 2015 and has since expanded into Malaysia, Indonesia, Dubai, Hong Kong, India and China.

Mr Prabhakara offers an example from one of the world's most successful online businesses to illustrate the appeal of WeInvest.

"Amazon Web Services is an infrastructure service and they give you everything from hardware and software, to different kinds of tools or everything on a per-use basis," he explains. "They make it extremely convenient, they make it extremely cheap, and they make it into an enjoyable experience to launch any service with their infrastructure. That is the same thing that we do, from a digital wealth perspective."

His company enables clients in the financial services industry to launch a digital wealth management platform with "extreme ease", as WeInvest will take care of almost all of the end-user requirements.

"The basic premise of a digital wealth platform is to make investing a much more enjoyable yet fruitful experience for the end consumer with lower cost, and this is typically the whole premise of most things that are digital," says Mr Prabhakara.

THREE PLATFORMS

WeInvest offers three platforms to its clients: TrackWealth, GrowWealth and AdviseWealth. TrackWealth enables the provider to aggregate and track its customers' financial accounts and see a consolidated picture of their position on a simple and secure platform. This includes information on income, expenses and assets along with growth, risks, and forecasts.

After this information is uploaded into TrackWealth to help in terms of financial planning, the customer can then be introduced to GrowWealth, which shows what options are available in terms of investing for various purposes, such as a child's education.

"If the customer wants to think about an investment in their child's education, retirement or just saving for a rainy day, he or she can go through this self-service advisory journey. For example, if they have a child, they will know exactly how much they will have to save for when the child turns 18 years old," Mr Prabhakara explains.

For example, if a person knows that they have to save up to US$100,000 over 12 years in order to pay his or her child's college fees, the app will tell them exactly how much to save per month while basing it on the customer's investment portfolio as well.

The app will even provide a probability in percentage terms to help the customer calculate the chances of reaching their financial goal based on their investment risks and predicted performance of the portfolio.

"Within 45 minutes, all the planning and investing for a certain goal can be done in one experience and that is pretty neat," he notes with pride.

WeInvest bills itself as a “digital wealth service provider” that helps banks, brokers, asset managers and financial advisers show clients all their best options.

AdviseWealth, meanwhile, enables relationship managers (RMs) to keep all of the data they need on a single tablet to manage the portfolios of high-net-worth individuals with greater efficiency and accuracy.

"With the app, the RM will be able to do a profile on a client in far more detail than what the bank has ever done, so that RM will be able to give the client the right kinds of ideas and not mis-sell a high-permission product," Mr Prabhakara says. The latter refers to a marketing practice where prospective customers are asked to share a lot of information about themselves, such as by filling out a detailed survey.

"No more paper signing, an all-digital workflow, no need to travel while being equipped with everything from product news to fact sheets and ideas. The RM can talk to their client via the platform also," he adds. "We called Advise Wealth the Iron Man Jarvis suit for relationship managers or advisers."

What WeInvest offers sounds fairly intuitive and straightforward, some people ask how it differs from thousands of other financial advice services. But its rapid growth suggests it has tapped into something that was missing in the industry.

UNMET NEED

Mr Prabhakara has spent his career at the intersection of technology and finance, as befits someone who graduated from Indian Institute of Technology Madras and went on to pursue graduate studies in finance at the Indian Institute of Management Ahmedabad.

In 13 years of working in the capital markets in roles that ranged from banking to consulting and technology outsourcing, Mr Prabhakara came to observe that there was one thing most financial institutions around the world do wrong: No matter what they might say to the contrary, they don't care that much about their smaller customers.

"A large portion of clients, whom I call the 'emerging affluent' in this vast market space, normally put money into deposits and there is no relationship manager to go and service them because they do not have that much money," he says.

"For an RM to service a client you must have a certain (sum of money on deposit) and this is a completely reasonable thing, because if you know the investment is not worthwhile, why would you put an RM in there?"

This emerging affluent space is an "unmet need", Mr Prabhakara says. All of these people have aspirations and financial goals but financial firms usually are not able to offer them the "personal touch service" they could use to help their modest wealth grow into something bigger.

"This is almost like a segment that has not been serviced and it is now getting a new offering to meet those needs. This is the first part of what banks and financial institutions can do now with current technology," he says.

The second challenge is in the affluent to high-net-worth space where relationship managers have experienced problems in terms of infrastructure and out-of-date legacy practices -- a lot of them paper-based -- that are common in Southeast Asia, the Middle East and even North Asia.

"Traditionally, wealth has been a laggard compared to retail banking or cards or loans in terms of automation," he points out. "Most RMs in Asia are still giving you a lot of papers to sign when you come on board as a client, unless they are from an international bank, and we have done away with a lot of that.

"The fact that products are growing at an immensely fast pace today means RMs need a digital way of distributing those products, fact sheets and maybe even training videos," he says, adding that the only way to solve the problem of mis-selling is through digital assistance.

HELPING ASIA INVEST

Given how wealth in Asia is growing at a "phenomenal pace", if there are tools to make saving and investing toward certain goals easier and to understand, "maybe more people will do it", says Mr Prabhakara.

While Asians are legendary savers, the culture of investing does not seem to be imprinted into Asian DNA, even in affluent Japan. According to the Bank of Japan, the majority of households' ¥1,809 trillion in assets in 2017 was sitting idle, either in cash or deposits paying next to nothing. Money in assets including investment trusts and mutual funds accounted for just 17%, compared with 52.4% in the United States.

In Thailand, where saving is also well entrenched, a lot of money is still pouring into the economy and people are still spending a lot. But many people seem intimidated by investing so they avoid it, Mr Prabhakara has observed.

"Today if I do not have that comfort then I will just go ahead and spend it," he says. "Yet while there is one part of that emerging affluent market growing at a fast pace, Thailand has always been a very active from an investor perspective.

"Looking at the SET (Stock Exchange of Thailand), it is one of the few markets in Southeast Asia that has a heavy degree of retail participation compared to institutional participation."

As Thai people are "keen on self-improvement through financial investing", Mr Prabhakara believes there is a need to provide structure, exposing them to more international products and giving them a much more enjoyable experience.

In 15 years' time, more than half of the world's middle class will be in Asia, while growth in the number of high-net-worth individuals is already leading all other regions. WeInvest is looking at that promising future as it builds its business. It is now working with three major banks in Thailand on a new platform to be launched in October.

"Together with CIMB Securities, we are launching in Indonesia, Hong Kong, Thailand and Malaysia and we will be in seven to eight countries by the end of this year," he says.

For Mr Prabhakara, growing up in southern India meant the culture of saving was drilled into him since he was a child. People were taught to save at least 20-40% of their income for a rainy day in a fixed deposit. However, he was also part of a generation that was seeing a lot of new opportunity as the consumer culture began to take hold, and this gave him the drive to also seek a better financial future for himself and his family.

"The desire to have a better lifestyle came at a time when you could do it through better investing rather than just saving … and the fact that there are 1.2 billion people that you are competing with also means you want to get ahead, and the best way to get ahead is to grow," he says. "From then on, investing became the driver on the Indian subcontinent, at exactly the same time as I was growing up."

His drive to get a good education was also strong, as was the desire to make the best use of that education once he entered the working world. But in the end, money is not everything for Mr Prabhakara.

"Financial stability is just one part but being able to ensure comfort for the generation to come is very important for me," he says. "It is not just about how much you earn, sometimes it is about how you spend it and what do you with the remaining money that counts."