More wealth managers will have an increased appetite to innovate their technologies as a result of cyber security measures, according to an industry expert.
Speaking at London’s FinTech week, Nik Lysiuk, senior analyst at ComPeer, a wealth management research house suggested that wealth managers could move away from their traditional approaches to innovation.
“I don’t think wealth managers are at the forefront of innovation which is why the industry is seen as being quite traditional and also being quite out of date,” he said.
“General wealth managers have a fear of security and with the increase in cyber attacks in a business that is based on relationships, when any wealth manager hears of a cyber attack this is something that they will want to avoid.
“This is linked to the appetite for innovating,” said Lysiuk.
Lysiuk’s suggestions come following news that the European Commission has signed a public-private industry agreement to push for greater cyber security across Europe, which is set to trigger a €1.8 billion wave of investment by 2020.
Lysiuk also suggested that the regulatory burden would also have an impact on wealth managers’ FinTech plans.
“It’s not that regulation is stopping wealth managers from doing anything but like any firms, they have finite resources.”
“Therefore they can’t plough money or people into IT investment when they are having to deal with the regulatory burden which is huge across the sector.”