MyPrivateBanking Blog
Daily Comments on the World of Wealth Management

Although there has been little acknowledgment from the wealth management industry, the rise in crowdfunding in recent years has been remarkable. Goldman Sachs sizes the addressable market for crowdfunding at about $1.2 trillion. This is the total market value for crowdfunding that could be realized in the long-term. For 2014, Goldman Sachs estimates the U.S. crowdfunding market size at $10 billion, up from just $1 billion in 2011. The Worldbank forecast that global crowdfunding could increase to between $500 billion and $1 trillion by the mid-Twenty Twenties. These numbers include marketplace lending (e.g. Lending Club), equity-based crowdfunding (e.g. Circle Up and OurCrowd) and donation-based crowdfundfing (e.g. Kickstarter).

But isn’t crowdfunding something invented by hipsters to collect a few thousand dollars for some crazy art project or an even crazier new invention that will not go anywhere? That was probably true in the very beginning of the crowdfunding trend, 10 or even 5 years ago. But nowadays crowdfunding has flourished into a multi-billion-dollar industry, quickly spreading across the globe. Even institutional money is now flowing into (specifically p2p/p2b) lending-based crowdfunding chasing for better returns than one can get on a typical fixed income security.

So crowdfunding is opening up not only to small retail investors but also to institutional and private wealth. Therefore, crowdfunding brings some threats to the wealth management industry. In a way it is another tool that disintermediates investing as robo-advice does in another context. Affluent individuals, HNWIs or potentially wealthy individuals are using more or less automated platforms to engage with investment targets in a much more direct fashion compared to investing through a typical wealth manager. The functional and emotional benefits of this type of investing may - over the long run - shift assets under management away from the traditional wealth management industry.

But where there are threats there are also opportunities…. We’ll explore the whole field of crowdfunding from the perspective of wealth managers and private banks in a shortly to be published new report. Stay tuned.


Here’s the fourth hint for our little quiz about which bank showed an outstanding effort in continuously improving its core banking app in our yearly ‘Mobile Apps for Banking’ benchmarking:


Watch out for our new report coming soon!


Here’s the third hint for our little quiz about which bank showed an outstanding effort in continuously improving its core banking app in our yearly ‘Mobile Apps for Banking’ benchmarking:


Watch out for our new report coming soon!


Here’s the second hint for our little quiz about which bank showed an outstanding effort in continuously improving its core banking app in our yearly ‘Mobile Apps for Banking’ benchmarking:


Watch out for our new report coming soon!


Google’s payment platform using NFC technology, Android Pay, announced earlier this year, has started to roll out in the U.S. today. Google seems to be back in the game of mobile payments with a promising start: over one million points of acceptance and gradually more announced to be joining. Like Apple Pay, the mobile payment solution loads automatically without having to launch an app, by simply unlocking the device. In-app functionalities are to be implemented later this year.

Google Wallet, the digital wallet forerunner in the U.S., will be automatically converted by app-update to Android Pay. However, the app has not been closed down but given an overhaul to serve as a P2P app (send and receive money).

Google’s Android has an impressive 79% worldwide market share, in the global market for mobile operating systems. Therefore, Google’s alternative to Apple Pay and Samsung Pay, has good chances to see early mainstream adoption among others due to retailers’ fondness of rewards schemes announced to become part of Android Pay’s functionalities soon.

It is surprising that it took Google so long to respond to Apple’s challenge. But there is no doubt that on a global scale Google has the power to become the leading mobile payment provider at the POS.


Among the banks evaluated for this year’s report on Mobile Apps for Banking, there is one remarkable example that managed to successfully climb up the ranking ladder over the last years. Participate in our little quiz and guess the bank!
We will release a hint each week until the report will be published by beginning of October 2015.

Here is the first hint:



MASTERING THE DIGITAL TRANSFORMATION – this was the slogan of this year’s Avaloq Community Conference. Besides presenting their impressing roadmap, clients and partners had the chance to attend live demos of exciting new tools and technological developments. Furthermore, there were several highly interesting presentations and panel discussions from Avaloq representatives, partners, and wealth management companies focusing on the digital transformation in banking and wealth management.

The main insights were:

Continuous experience across all channels are key. Continuous experience across all channels beats self-service/virtual branches (2nd) and collaboration tools on digital channels (3rd) in the race for banks’ digital strategy’s top priority according to the conference attendees’ voting.

Robo technology is no nice-to-have but the prerequisite for successful advisory. According to Thibaut Jaquet-Lagreze, Head of Marketing & Sales at Avaloq, the biggest costs are no longer caused by the back-end but by the front. The use of automated services (financial health checks, real-time market information, proposal generation, etc.) is the only way for financial advisors to serve a large number of clients and, thus, to generate margins securing their jobs.

Growing critical factors are agility and flexibility. Financial institutions and their clients are becoming increasingly demanding when it comes to flexibility regarding the digital services. Here, Avaloq is a clear industry leader thanks to their unique Banklet™ technology. Barclays, whose wealth arm is relying on the Avaloq system, enable their clients to pick products and services from the Features Store to their accounts to allow for tailored solutions meeting clients’ individual needs (learn more in our upcoming report on Mobile Apps for Banking 2015 by end of September).

Vendors and banks are awaiting Generation Y. One common aspect of banks’ digital strategies was that Generation Y is just about to enter their client environment and that this leads to completely new challenges. Grown up with iPad, smartphones, and social media, young people expect their bank to offer them an integrated experience across all these channels to foster a personalized relationship and tailored wealth management services.

FinTechs’ influence is skyrocketing - crowdfunding and –lending are the hot trends. Total loans in crowdlending added up to $8bn in 2013 and are estimated to grow to $40bn in 2016 and to reach $1trn in 2025. Keep an eye on this trend and its effects on the banking industry and watch out for our new report on crowdfunding coming out this month!

Slim and integrated user interfaces are what banks should strive for. Integrated digitalization layers should serve all channels and all customers for building a common basis for internal and external customers, which significantly enhances communication. Moreover, to say it in CEO Francisco Fernandez’ words: the aim should be to “hide complexity, making it sexy to use”.


The smartphone business is booming with breakout successes like the iPhone 6 and 6 Plus and the mobile usage is growing at a fast-pace to the detriment of laptops/ internet from home use. It should not be surprising that criminals have also adapted to the new trends and more than 1.3 million unique smartphone attacks have been reported from January to October 2014.

While one of the main causes is the increasing amount of mobile transactions and payments, the multitude of digital communication tools like the real-time apps helping advisers improve communication with their clients also keep clients engaged with their mobile devices. High-net worth clients are attractive targets for mobile security breaches as they mostly manage their wealth while on the way and use unsecured Internet access points (see our report on the mobile behavior of the affluent and HNWI).

But what are the main factors driving security breaches of mobile apps in the banking field? MyPrivateBanking’s recently released report on Mobile Apps for Wealth Management 2015 found that secure client authentication is still being neglected by many wealth managers. Few of the evaluated wealth managers /private banks are using the gold standard to protect clients’ data by making use of a full two-factor authentication procedure plus adding a multi-layered anti-fraud framework. Striving to provide their clients with a convenient, easy-to-access information, some wealth management apps even allow users to log-in with only their 5-digits passcode thus ignoring the fact that these weak security measures make their clients easy prey for hackers who illegally try to access personal data.

One of the main areas of risk, which is often being neglected by banks, is that criminals are targeting not only the secured spaces where transactions are being made by clients but also other apps/features where they are able to identify personal data (for instance address, birthdate or trivial things like shopping coupons). Putting together this information can easily lead to so called identity theft, enabling criminals to break into even better secured systems.

Wealth managers should think hard about an integrated and broad security strategy, even if they have to sacrifice a bit of convenience for their clients to gain gold standard security.


Having just released the earnings report for Q2 2015 (Q3 2015 in Apple’s fiscal year), Apple pronounced some interesting results. While the company sold 47.53 million iPhones in the last quarter, the revenues derived from the iPad are continuing to decline: only 10.93 million iPads have been sold in Q2. There are still no numbers for the Apple Watch but we know that its launch has caused a serious hype, leading to a real race for Apple Watch apps among retail banks worldwide. However, after skyrocketing at the beginning, sales seemingly went down quickly according to Slice Intelligence.

So what’s the future for banking apps? We can definitely say that iOS and Android devices will continue to dominate the apps market, particularly in the banking sector. Particularly some private banks and wealth managers have in the past published some of their apps only on iOS assuming that wealthy clients will have a clear preference for Apple devices. Today, we can clearly refute this assumption with the exception of only a few local markets (Switzerland has been so far one of the few examples of strong iOS dominance). What will be interesting to see is the development among the respective devices and their screen sizes. Will the trend for bigger screens – enforced by the launch of the iPhone 6 Plus – elbow tablet devices out of the market or will there be a reversal in consumers’ taste such that phablets will definitely leave the stage in favor of a more diverse use of mobile devices? We are convinced that tablets will play a strong but clearly defined role in the world of banking apps. Sales of the iPad may take a dive but this has not necessarily implications for the usage frequency of tablets. It is more likely that this reflects that customers have longer intervals for buying a new tablet as compared to their smart phones; plus there is now ferocious competition in the tablet market, undermining the market share of the iPad.

However for the time being, smartphone apps are clearly in the lead and banks should focus on the development of apps, which work optimally on these devices. Particularly among the wealthier clients, however, tablet devices are just as popular for viewing investment portfolios, interactive graphics, articles, and video material. Hence, banks and wealth managers should closely watch market trends and listen to their customers to be able to react fast and adequately. Only time can tell what role smartwatches will play in the future but considering the Apple Watch has been the hot topic of the first half of 2015, we are currently taking a closer look at banking apps developed for smartwatches as an interesting add-on for our upcoming report on Mobile Apps for Banking 2015 (see last year’s edition here).


Evaluating the apps of the 30 leading wealth managers for our Mobile Apps for Wealth Management 2015 report (launched two weeks before), we were impressed by the rapid adoption of the smartwatch trend evolving to a major part from the launch of the Apple Watch. During the evaluation phase, several wealth managers were throwing their version of a wealth management smartwatch app into the market.

Given the usually slow progress of the wealth management industry in terms of digitization, this development is particularly noteworthy and it implies that the boom of smartwatch app has only just begun. Therefore, we also expect a dramatic increase of the number of banking apps in the retail sector. Starting our new project on the Mobile Apps for Banking 2015 report (see last year’s edition here), we are curious to see how banks are realizing their version of their banking app’s smartwatch counterpart. It is clear that the smartwatch banking apps’ core functions will mainly include features like notifications and communication. Especially in terms of communication, banks will face major challenges as this article describes.

We will be excited to shed a light on the developments and the industry best practices with regard to smartwatch apps for banking for the first time – so watch out for our 2015 report on Mobile Apps for Banking coming out this fall!