Latest research from digital consultant Capgemini shows Australia's high-net-worth individual (HNWI) population is growing, with more than 20,000 Aussies joining the fold in 2017.
According to Capgemini's 2018 World Wealth Report, Australia's HNWI population grew 9.2% across the past year, with 278,000 Aussies now holding more than US$1 million of investable assets.
Cagemini Australia and New Zealand financial services practices lead Philip Gomm attributes the growth to superannuation savings.
"In Australia, we have seen superannuation savings provide a key contributor to HNWI growth. Superannuates with more than $1m in investable assets will increasingly require the sophistication of hybrid investment services, where advanced analytics coupled with robotic processes can contribute to ongoing returns," Gomm said.
|Sponsored by PIMCO|
Ben Bernanke On Growth, Trade, Geopolitics
According to Gomm, non-financial services tech giants - otherwise known as BigTechs - such as Amazon, Alibaba, Apple and Google are battling to enter the wealth management space as HNWIs across the globe demand hybrid advice.
"The race is on to beat BigTech firms in providing the best investment performance analytics and automated processes on an intuitive easy to use platform," he said.
According to the report, the threat of tech-first businesses entering the fray has forced wealth management firms to accelerate the transformation of their advice models to incorporate "hybridity". In the final three quarters of 2017, the number of wealth management firms that had a hybrid-advice transformation program running increased by 3.4 percentage points.
However the research claimed the transformation needed quicker implementation, with Capgemini highlighting lower HNWI satisfaction with hybrid-advice, and HNWIs curiosity in wealth management services offered by BigTechs - with more than 50% of HNWIs expressing interest. According to the report, the impact of HNWI interest in BigTech could translate to potential asset flows of US$12 trillion.
HNWI curiosity in BigTech offerings comes as wealth managers deliver strong returns, with global HNWI investment returns growing by 27.4% in 2017, according to the report.