Fintech a vertical integration disruptor – ASIC
Vertical integration, particularly with respect to the major banks, is likely to be eroded by financial service technology, according to Australian Securities and Investments Commission (ASIC) chairman, Greg Medcraft.
Giving evidence before Senate Estimates, Medcraft said he believed the banks were starting to realise that owning something and cross-selling was probably not a viable strategy anymore.
Asked by Tasmanian Green Senator, Peter Whish-Wilson whether vertical integration was being addressed in line with the recommendations of the Murray Review, Medcraft said he believed progress was being made.
Whish-Wilson also asked whether the financial services technology changes had been a factor in ANZ’s decision to exit some of its wealth management business.
“I think the market will reshape banking – and the market includes things like the crowd and digital disruption,” the ASIC chairman said.
“Things are moving much faster. You are already seeing the sale of wealth management,” he said. “The point is that, these days, I do not necessarily need to own something to actually offer the best product to my customer.”
Recommended for you
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
Australian investors are more confident than their APAC peers in reaching their financial goals and are targeting annual gains of more than 10 per cent, according to Fidelity International.
Zenith Investment Partners has lost its head of portfolio solutions Steven Tang after 17 years with the firm, the latest in a series of senior exits from the research house.
