Unlocking Customer Confidence: Improve Onboarding and Boost Your Revenue by Leveraging Educational Analytics

In a lively and brief presentation at the Hubbis Independent Wealth Forum in Dubai on March 6, Erik Brodin, in charge of product development at Kidbrooke, a Swedish ‘WealthTech’ company, highlighted the significant impact of digital solutions on the financial industry, drawing attention to the growing interest in occupational pensions and retirement planning in the UAE. He explained that Kidbrooke's platform offers a wide array of use cases driven by financial data and analytics, underscoring the transformative role of technology in enhancing financial literacy and boosting client confidence, ultimately leading to increased assets under management and more premiums on products for financial, investment and wealth market players.

Going digital (but also staying personal)

Brodin opened his commentary by citing ‘Lysa’, the largest digital-only investment manager and adviser in Sweden, representing 0.5% of the fund savings market and 3.5% of total inflows there as an example of the growing appeal and reach of digital solutions, in this case especially among women, and signifying the broad market demand for such evolutionary services. Despite this, the complexity of some financial services necessitates a hybrid model that combines digital self-service with physical (or human) advice to gain the fullest traction among users.

Addressing occupational pensions, Brodin stressed the challenges employers in the UAE face in explaining retirement planning to their employees, highlighting the correlation between financial literacy, confidence, and retirement savings. Using Skandia, a major private pension and life company in Sweden, as a case study, he illustrated how digital services for pension advice can lead to substantially higher investments from clients who engage in both digital self-service and personal advisory meetings.

Essential changes required

Brodin advocated for the vital importance, indeed necessity, of digital transformation, not as a choice but as a strategy to optimise business by increasing financial literacy and confidence among customers.

He outlined three key strategies to achieve this: increasing conversions through self-service tools that educate and prepare customers for financial decisions; reducing churn by engaging customers through technology-driven notifications and a client portal for financial oversight; and providing more advice by leveraging technology to automate tasks and streamline advisory time, making the process more efficient and scalable.

Kidbrooke’s approach

Referring directly to the ‘Kidbrooke One’ offering, Brodin’s accompanying PDF/slide show highlighted the various solutions it offers. It provides a comprehensive framework for integrating Market and Environmental, Social, and Governance (ESG) Data into financial planning, emphasising the importance of economic scenarios and customer profiling in the process.

It provides steps for aggregating, enriching, and transforming investment product data from third-party sources into a normalised data Application Programming Interface (API). This process is essential for providing a robust foundation for investment analysis and decision-making.

Customer profiling is addressed through the implementation of risk- and sustainability-focused questions that are tailored to the user's specific outlooks. This approach ensures a personalised experience while also detecting any inconsistencies in user responses, thereby enhancing the accuracy and relevance of financial planning.

The framework supports a wide range of financial products, including investments, pensions, credit, insurance, and tax planning. It integrates a detailed cash flow model with stochastic market scenarios, allowing for the simulation of various economic conditions and their potential impact on financial plans.

Hosting capabilities include the management and monitoring of products and model portfolios across multiple universes for each available execution platform. This includes stochastic economic scenarios that capture the essential stylised facts of historical returns and adapt to house views.

Finally, the framework provides tools for creating optimal portfolios based on historical or future outlooks and searching investment universes for relevant products. This allows for a tailored investment strategy that aligns with individual client profiles and market conditions.

Brodin told guests that Kidbrooke's solution, with its unified functionality, data analytics, and service model, offers to automate manual tasks, reduce operational risks, and expedite time to market for financial services providers.

Kidbrooke’s doors are open

He concluded with an invitation to any delegates (or indeed readers) for further discussions, emphasising his preference for face-to-face interaction to explore further how Kidbrooke can support financial advisors and their clients in elevating their digital capabilities and thereby better navigate the complexities of retirement planning and wealth management.

Expert Views from Kidbrooke’s Erik Brodin

Digital Evolution in Finance: "Sweden has significantly influenced the finance industry's data services, revealing a marked preference for digital solutions, particularly among women. This trend underscores the expansive market for digital finance, highlighting the sector's evolution toward technology-driven solutions."

The Necessity for Combined Digital and Physical Advisory Models: "The complexity inherent in some financial services necessitates a blend of digital and traditional advisory models. Combining self-service digital tools with in-person advice meets the complex needs of clients, marrying the convenience of technology with the indispensability of human expertise."

Addressing Retirement Planning Challenges in the UAE: "The growing interest in workplace savings in the UAE faces hurdles, particularly in communicating pension benefits effectively. Surprisingly, 40% of UAE employers struggle with this, pointing to a significant opportunity to improve financial literacy and retirement savings among the workforces."

Boosting Financial Literacy with Digital Tools: "Utilizing digital platforms for pension advice not only educates but also instils confidence in clients, as demonstrated by Skandia's experience. Clients engaging with these platforms invest significantly more, illustrating how digital solutions can empower individuals to make more informed financial decisions."

Leveraging Technology for Financial Advisory Optimisation: "The debate isn't about adopting digital technologies but optimising them to enhance business. Enhancing client financial literacy and confidence through technology not only increases assets under management but also streamlines the advisory process, offering a roadmap for financial services to navigate the future."