Financial Service Innovation: Analysis of Wealth Management as a Service Model

The wealth management as a service model provides highly integrated solutions to help financial institutions enhance their service capabilities through a turnkey project model, combining cost advantages and economies of scale.

In the current market environment, high net worth clients have put forward stricter requirements for wealth management institutions, not only requiring specialized asset allocation advice, but also looking forward to full lifecycle services covering health management, pension planning, and other dimensions. However, the reality shows that many industry institutions have obvious shortcomings in terms of technological reserves, talent pool construction, and innovative profit models, making it difficult to support the resource investment required for business transformation.

The new service paradigm that has emerged in this industry context covers the entire functional modules of the wealth management business chain through integrated solutions. This model effectively solves the system integration and marginal cost control difficulties faced by traditional financial institutions in business expansion, making it possible to expand the wealth management landscape with lightweight technology.

After the concept of open banking gave birth to the bank-as-a-service model, the wealth management field is undergoing a similar revolutionary change. Although the digital transformation of the industry is relatively lagging behind, new service models have shown strong development trends and are restructuring the supply of traditional wealth management services.

Based on in-depth research on 33 technology service providers and 25 licensed institutions (covering commercial banks, insurance groups, and asset management institutions), combined with industry data modeling and executive interviews, we have systematically sorted out the evolution path and development momentum of service model transformation. The core research findings focus on three major dimensions:

The pressure of restructuring the competitive landscape in the industry

The constituent elements of a service ecosystem

Strategic Decision Points for Mode Transformation

The core research findings include:

The efficiency improvement brought about by mode transformation enables institutions to focus on creating core value. By outsourcing standardized business processes such as brokerage trading, investment advisory filing, trust services, etc., enterprises can not only optimize their product system, but also achieve a dynamic balance between technological iteration and business innovation.

2. Integrated service solutions are favored by institutions. Nearly 90% of the surveyed institutions (88%) admitted that they currently cooperate with more than five technology service providers, and the collaborative costs caused by multi system parallelism have become the main bottleneck restricting development.

3. Technical service providers are generally committed to building a complete capability map. Most suppliers are filling their capacity gaps through strategic partnerships or mergers and acquisitions, striving to provide end-to-end solutions for financial institutions.

The process of service integration faces practical challenges. More than half of the respondents (54%) listed organizational change risks and implementation costs as their main concerns, and 65% of institutions explicitly require suppliers to provide full process transformation support solutions.

5. There is still a supply gap in the existing service ecosystem, but specialized compliance solutions and brand customization services are accelerating to make up for these shortcomings.

Industry Impact Assessment

The new service model has significantly reduced the entry threshold for wealth management services through ecological integration, reshaping the industry's competitive landscape. Despite facing challenges in technological standardization and compliance, strategic business outsourcing enables traditional financial institutions to maintain their core competitiveness while rapidly enhancing their market responsiveness in wealth management.

During the critical window of industry transformation, professional service agencies can provide full cycle support from strategic consulting to technology implementation. By building intelligent service platforms such as EY Nexus, we focus on strengthening the collaborative capabilities between financial institutions and technology service ecosystems, helping customers achieve service innovation and value breakthroughs while ensuring compliant operations.

Industry Outlook

Strategic outsourcing of business modules has become an effective path for various licensed institutions to enhance their competitiveness in wealth management business. This innovative model not only optimizes the cost structure, but more importantly, creates a more flexible business growth curve, injecting new momentum into the sustainable development of the industry.

（Writer：Dirick）