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How To Transform Hyper-Personalization in Financial Advice

Key takeaways

  • In Europe, regulations in regions are too segmented to provide a unified experience and service.
  • The more informed the clients are, the more they’re able to judge the services provided by institutions for themselves.
  • Financial literacy is not difficult to understand, it’s just not properly taught to people, especially from a young age.

Giorgio Carlino, CFA

Co-Founder & CVO at MAS4

Co-Founder & CVO at MAS4

Qn 1: What are your thoughts on the recent increase in hyper-personalization in financial advice? 

Answer:

In the US, there’s a fair amount of personalization from multiple players in the industry, which results in competitive pricing and services for the customers. On the other hand, in Europe, there’s a lack of personalization and the prices are usually on the steep side. There’s inadequate customization of services because firms generally create a limited number of profiles that provide generic advice across customer needs. Europe has a lot more regulations for different markets in different regions. As such, not every country can scale the wealth management business, and the industry cannot standardize the processes. 

Qn 2: What is an example of how personalized financial advice can work in the future?

Answer: 

For Europe, the industry needs to emulate what has already been done in countries that have successfully commercialized convenient and flexible services. What’s missing is an initial investment in the financial environment in Europe from established financial companies. However, foreign firms are hesitant to set up in Europe with such fragmented regulations because the return investment isn’t enticing enough.

Qn 3: What is your company doing to increase customer engagement and confidence in their financial institutions? 

Answer:

To start, customers mistrust banks and the system because banks sometimes mismanage their clients’ funds and charge unethically. Regulations are needed to keep such dishonest schemes at bay. As such, an independent institution that refrains from trading products and prioritizes educating clients about their financial futures is required. Methods would help gain clients’ trust and increase the willingness to learn when they understand they’re not led to buy products. MAS4 is heading in this direction by providing clients with the financial knowledge they need to discuss intelligently with their advisors, achieving a portfolio that they need and understand fully.

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