Asian banks must customise its approach

They are young, business-minded and have made their fortunes faster than the last generation.

Meet Asia’s Affluent who are driving the next wave of wealth creation in Asia.

By 2015, the affluent population in Asia, ex-Japan, is expected to grow from 20 to 31 million, with combined liquid assets reaching a staggering $12 trillion, according to Data monitor. Asia’s affluent segment is one of the fastest growing and most exciting in banking today. Yet, their needs have been underserved, or served in a fragmented manner, by banks.

Today, the Asian Affluent are looking for more than nice premises, a prestigious brand and an assortment of products. They are ambitious, increasingly international in their outlook, and their financial needs are more sophisticated and wide-ranging than before.

Changing outlook

A rising trend is the increasingly international outlook of Asia’s Affluent. In the past, the Asian Affluent tended to be more focused on their home country for wealth creation opportunities. But today’s Affluent Asian travels more — both within and outside Asia — making the most of business, work and education opportunities across the globe.

As many as 40 per cent also view Europe and North America as presenting attractive investment opportunities. It is therefore not surprising that up to 60 per cent of Asia’s Affluent place value on services which help them transact with ease wherever they are, and more importantly, connect them to global investment opportunities.

In the next five years, we will also see a transformation in the way the Asian Affluent will choose to interact with banks. The increasing mobility of Asia’s Affluent, coupled with their rapid adoption of the Internet and mobile devices, is the single-most disruptive force that will drive banks to reshape their current channel model.

The conventional channel model for servicing affluent clients places strong emphasis on physical channels such as exclusive client centres or retail branches. But, the future trend is pointing to a latent client need — the use of digital channels as a vital part of their wealth management process.

Use of digital channels

Digital channels can, and must, become an effective delivery channel in the advisory space to provide education on investments and wealth strategies — an area demanded by 90 per cent of Asian Affluent, and to serve the investment transactional needs of a growing mobile population. The client relationship model that will emerge is one where both personal and digital interactions will play equally important roles in the advisory process.

Solutions recommended will need to depart from the customary approach of addressing only the individual’s needs, to one involving a holistic view which includes his or her family and business interests. The Asian Affluent will require a customised approach, as one size does not fit all. More fundamentally, banks must not forget the core principles of building strong relationships — that is, taking a genuine interest in the client above all, and clearly demonstrating an openness and willingness to invest the time to listen and uncover the unique needs of clients — an ingredient of success which cannot be substituted by technology.

The ability to connect and integrate resources within the bank to serve the Asian Affluent will be the single biggest advantage that any bank can have.

This includes providing clients with the right advisory platforms (both personal and digital), addressing their individual and business needs holistically, and linking local and international capabilities. Making this paradigm shift will be key to developing successful client relationships with the Asian Affluent.

(The author is Global Head of Priority and International Banking, Standard Chartered Bank. The views are personal.)

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