This publication and Appway recently launched a study examining client onboarding trends. Kicking off debate, in the second part of a two-part feature, is Dominic Gamble, co-founder of findaWEALTHMANAGER.com.

WealthBriefing and Appway recently launched a new study examining client onboarding trends in wealth management. Kicking off the debate (in the second part of a two-part feature) is Dominic Gamble, co-founder of online matching service findaWEALTHMANAGER.com and a former private banker internationally. (To see the first half of this article, click here.)

WealthBriefing and Appway’s research report will examine what wealth managers are doing to prevent dropouts during client onboarding. What are your views here?

At findaWEALTHMANAGER.com we observe a general issue between clients and wealth management generally – and this is that clients just do not tend to prioritise getting their wealth working until they have a strong trigger to do so. It’s human nature to confine managing our money to the “admin drawer” of life, so winning a new client is always going to be a lot tougher for wealth managers than it is for FMCG brands.

It can take an awful lot of time and effort to get a prospect to the account-opening stage, which is one of the reasons why many wealth managers are looking at new, more cost-effective ways to get leads, such as our site. Having got a client so far, the institution then must do everything in their power to get them over the line. It must be soul-destroying for relationship managers to see poor onboarding processes turning new clients off and ruining all their hard work.

In my experience, wealth managers usually rely on the people skills of the relationship manager to prevent prospective clients dropping out during onboarding. However, we (and our users) have been really impressed by the more proactive, thoughtful approach taken by several of the wealth managers on our panel. These firms have dedicated account opening personnel who will manage the generation of the necessary documents, aid the client and relationship manager through the signing process and then monitor the account opening through the various KYC and compliance stages involved.

In many ways this is an excellent approach as it means the relationship manager and client don’t get so bogged down in administrative details which may cloud the wider wealth management conversation (or indeed become annoyed at each other). This approach is likely to create additional costs, however, and its underlying effectiveness will still depend on the quality of the onboarding processes in place.

Some might argue that wealth managers should focus on serving their existing clients better, rather than investing in enhanced onboarding. What is your view on this?

Playing defence, as they would say in the US, is asking for your business to be hurt. Wealth management may have been an opaque, uncompetitive and slow-moving industry historically, but it is now waking up to a new reality in which clients are more demanding and less loyal than ever. Firms which don’t move with the times, which don’t pay heed to changing wealth demographics and which don’t deliver the slick digital experience consumers expect today, will lose out.

Retaining and deepening wallet share with existing clients is naturally a priority, but I don’t think this needs to be at the expense of efforts to improve prospecting and onboarding for new clients (or vice versa). The pursuit of high-quality, client-centric and efficient processes should marry up across the client lifecycle over time.

It’s easy to see how extended questioning and documentation requirements could be detrimental to the client experience. But do you see any upside, for either client or institution?

Adhering to regulatory requirements is absolutely non-negotiable, of course. But doing onboarding really well is about so much more than avoiding business risk.

Effectively managing the onboarding process - so that clients know what’s going on and why, and so that repetition and delays are minimised – will be immensely reassuring to them. This will get the relationship off to a flying start and is likely to massively increase the amount of business the client wants to do with you. Looking further out, wealth managers should be looking to use the information they gather at client onboarding in more intelligent ways. If a wealth manager is fully in control of all the client data it holds there is a huge amount they can do with it for marketing and sales purposes.  

Clients generally see the onboarding process just as a hassle, while wealth managers see it as a costly administrative burden – yet it could be a valuable exercise for both sides if clients end up with a more tailored offering and wealth managers are able to take more of the right products and services to their client base at the right time.