Close to one in three wealth management professionals (29%) said new clients are having to wait three months or more to be fully onboarded, according to research from financial tech firm Avaloq.
Avaloq said that despite the onboarding process being one of the most important milestones in the client relationship, ultra-high net worth (UHNW) clients are facing a lengthy delay when they appoint a wealth manager.
Only 13% of professionals surveyed said their firm’s onboarding for UHNW clients takes a week or less.
The research indicated that the wealthier the new client, the more protracted the onboarding process typically becomes.
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Clients with lower amounts of assets face less difficulty, but one third (33%) of professionals questioned said onboarding can still take up to a month for affluent clients.
Avaloq said onboarding varies between the UK and the other markets included in the survey. Professionals in the UK deem tasks associated with onboarding as more onerous than their continental European counterparts.
Internal approval processes were highlighted as a ‘pain point’ by 88% of UK respondents versus 76% in continental Europe. Manual intervention was flagged as an issue by 70% of UK respondents compared to the European average of 62%.
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This disparity was also evident in the tasks deemed most time-consuming, with 70% of UK respondents claiming that know your client (KYC) checks take too much time, versus 63% of European respondents.
When asked what would support them in their current role, 96% of relationship managers globally stated that simplifying or automating the onboarding process would offer a minor or major improvement.
Suman Rao, managing director for the UK and Ireland at Avaloq, said: “The onboarding process leaves clients with a lasting impression of their new wealth manager, so it is vital that it runs smoothly. Not only does this set the tone for a positive client relationship, but it also increases the chances that the client is likely to stay and invest over the long term.
“It is concerning to see that wealth managers face such hurdles when onboarding clients,” he continued. “Technology can transform the onboarding process by automating and streamlining regulatory checks while integrating consistent onboarding templates in the firm’s platform. By automating manual processes, wealth managers can focus more time and resources on providing better client service and gain a competitive advantage over their peers.”
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