Digital transformation is a top priority for asset managers, according to a new report published by banking software company Temenos investigating the views and intentions of the asset management industry over the coming 12 months. 

Significant constraints imposed by legacy technology systems however were cited by 54 per cent of respondents globally as a major problem holding them back.
 
The report entitled: “Digital transformation in fund administration: The road ahead”, delves into responses from over 150 asset managers, fund administrators and custodians across Europe, the United States and Asia.
 
The global asset management industry is experiencing fundamental shifts that will shape its future.

The report shows that digital transformation is set to play a large part in this future.

The survey found that investment in new technology and digital transformation is the number one focus in asset management, with 38 per cent of respondents saying it will be their firm’s biggest focus over the next 12 months.

Digital transformation is followed by a focus on investment in product development (19 per cent), operational efficiency (16 per cent) and distribution (12 per cent).

An overwhelming majority of respondents, more than 90 per cent of those surveyed, also said that investment in operational systems is now essential for asset managers to improve efficiencies and reduce costs.

29 per cent of respondents cited data analytics as the highest priority for investment.
 
Despite the imperative to digitally transform, nearly a quarter of respondents (23 per cent) said asset servicers, such as fund administrators and custodians, are not currently keeping pace with the changing requirements of asset managers.

54 per cent of respondents globally cite legacy technology as a major problem holding asset management firms back from delivering high quality services through digital channels. In the US, this problem is even more exacerbated, with 60 per cent of respondents saying that legacy systems remained a major problem.
 
The survey also highlighted that outsourcing of functions to asset servicers is set to narrow, with over two-thirds of those surveyed (68 per cent) saying it was important to have one strategic service provider who can support all outsourcing requirements.

Many respondent firms are already moving in this direction, with more than half (55 per cent) saying that they have a single provider in place or will do so within three years.

source: institutionalassetmanager

(باللغة العربية)  

The main objective of the digital transformation process developed in the vision of the Kingdom of 2030 is to move the Saudi economy from the state of economic activity based on oil revenues mainly to the state of economic activity, which is characterized by diversity in sources of income and which ensures sustainable economic development and reduction of leaks in Capital and services abroad The estimated amount of money spent on medical services paid by Saudis abroad is estimated at SR 2 billion (540 million dollars). In the education sector, Saudis spend about 15 billion riyals ($ 4 billion) abroad and in foreign tourism. To about 30.5 billion riyals ($ 8.1 billion), while the leakages in the capital invested is estimated at about 312 billion riyals ($ 84 billion) in the year 2018 only.

   The Digital Transformation Plan aims to enable the realization of the vision of 2030 by moving to a digital society based on interaction, exchange of experiences, biographies and a digital economy that creates an environment conducive to entrepreneurship, new functions and a digital government based on data sharing and digital services.

Transformation strategy

The strategy of digital transformation is based on the transformation of the digital world and work in this phase on four axes focused in four sectors, education, health, electronic commerce and smart cities, through the establishment of digital units of the concerned ministries, and highlights the progress in the process of digitization through the achievement of many achievements, the most important is the virtual school experience and the smart classrooms in the education sector, consulting and health services remotely in the health sector, which provides all citizens the ability to get medical consultations for three times a month for free via Smartphone applications. In addition, a number of smart city applications have been activated such as car parking, light signals and intelligent waste management in a number of Saudi cities. In terms of e-commerce, the digital and legal environment is being developed to expand the size of the electronic market in the Kingdom. To provide greater transparency and reliability in e-commerce exchanges. The development and support of the e-commerce environment has played an important role in promoting the growth of this sector. The Kingdom witnessed a remarkable development in the volume of e-commerce, The number of electronic stores registered in the Kingdom reached 25501 electronic stores in 2018, which indicates the growing importance of this sector, which coincides with the rise in the number of Internet users in Saudi Arabia, which reached 88% of the total population The development of the legal and digital environment in Saudi Arabia was reflected in an advanced ranking in the United Nations e-commerce and online shopping index, particularly between companies and consumers, ranking 52 out of the 151 countries surveyed, indicating to some extent the will of the relevant policies to develop this evolution Important and vital sector.

Investing in digital transformation

The process of digital transformation necessitates the necessity of quality equipment and in huge quantities. It also requires large investments in infrastructure projects and pioneering ideas that contribute to the digital transformation process through smart and innovative solutions. This opens the door for entrepreneurs and entrepreneurs to establish their own businesses and make profitable investments by keeping pace with the transformation process. For example, in the field of digital transformation, the Saudi government has contracted a $ 1.6 billion ($ 420 million) smart board supply contract with the Education Technology Development Company to support the education sector and smart classrooms, Stamps for electronic ones in Saudi schools, and we can imagine the electronic equipment needed for all Saudi schools and the size of applications "and later universities" to carry out the process of digital transformation, a process for quite some time and require huge investments. The same applies to Smart City projects and the health sector in the Kingdom.

UK-based Jupiter Asset Management said that the Middle East financial services industry is ready to adopt technology disruptions as rapid developments in financial technology, new regulations to improve transparency and the rise of digital savvy millennials support an irreversible global trend towards financial innovation.

Banks and financial institutions in the GCC region are showing considerable promise in adopting financial innovation as well as collaborating with fintech firms to digitalise operations and provide new solutions to customers.

Guy de Blonay, the Fund Manager at Jupiter Asset Management, said, “Across the Middle East, and particularly in the GCC, financial services providers are demonstrating a commitment to innovation, securing a number of partnerships with fintech providers as well as adopting the latest technologies from cybersecurity tools to payment platforms and working with regulators to increase access to new technologies.

Jupiter Asset Management stated that financial innovators in the UAE, Saudi Arabia and Bahrain, receives support from a Sandbox regulatory environment to facilitate the impact of new technologies as well as supporting firms in testing innovative solutions.

The establishment of fintech incubation programmes such as Dubai International Financial Centre’s (DIFC) FinTech Hive and the Saudi Arabian Monetary Authority’s (SAMA) Fintech Saudi, demonstrates the GCC bloc’s readiness to provide an environment for growth of emerging technology companies, added Jupiter Asset Management.

Additionally, the recent London IPO of Network International and Careem’s merger with Uber further highlights the region’s capacity to provide a fintech ecosystem for growth of world-leading technology firms.

Source: bankerme