UOB Bank is ramping up its digital innovation to grow its wealth management franchise to serve more of Asean’s growing population of underserved increasingly affluent consumers.
On June 24, the bank announced that it has designed a suite of simple digital solutions for customers to protect and grow their assets easily, using just their mobile phone.
Named SimpleInvest, the solution helps UOB’s customers to begin their investment journey with as little as just $100.
According to the bank, the product is aimed at a particular target market that perceives investing as difficult and requires significant sums, or do not have the knowledge or confidence to do so.
As such, the bank sees “immense opportunities” in helping them growing their wealth through simple means.
According to UOB’s Asean Consumer Sentiment Survey conducted over 3,500 respondents in five Southeast Asian countries in July 2020, over 60% of consumers in Asean have indicated that they prefer online channels to apply for simple banking products.
In Singapore alone, where banking services are easily accessible, over 70% of Singaporeans say that they’re not investing as much as they should and have surplus savings in their emergency fund, according to the bank’s survey on investing sentiments. This survey was conducted among 500 Singaporeans in September 2020.
With SimpleInvest, customers get to choose from three solutions on the UOB Mighty app that fulfil the objectives of liquidity, income and growth.
Customers who choose liquidity as their end-objective can invest in UOBAM’s United SGD Money Market Fund, which seeks better returns than cash.
This is done through the fund’s investments in low-risk and liquid assets such as high-quality bonds, government securities, money market instruments and bank deposits.
UOB has also partnered with UOB Asset Management to develop the income and growth solutions that invest in funds that are screened and selected by the bank.
The funds are actively managed by asset managers such as Allianz, Fidelity International, JPMorgan Asset Management, Schroders and UBS Asset Management.
Investors seeking to generate regular income can choose the United Enhanced Income Select Fund, which invests in a spectrum of yielding assets, while investors looking to take advantage of the changing structural trends such as healthcare and sustainability can opt for the United Enhanced Growth Select Fund.
UOB says it plans to roll out its suite of solutions across the region progressively.
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The bank will invest over $200 million in digital innovation over the next three years to serve consumers, says Jacquelyn Tan, UOB’s head of group personal financial services.
“The pandemic was a tipping point for digital financial solutions as more UOB customers embraced the convenience of online channels to transact and to grow their wealth. We have tapped this permanent change to expand our digital wealth offering to provide simple, self-serve products and solutions through UOB Mighty.”
“While the barriers to accessing digital financial solutions have lowered, our research has shown that consumers can feel overwhelmed by a plethora of products. Our approach is to guide customers to the solutions that make the most sense for their financial goals and we use a combination of human expertise and technology to do so,” she adds.
“Through our wealth management strategy, anchored by a digitally-enabled omni-channel customer experience, we aim to double our wealth fee income by 2026. This translates to a compound annual growth rate of more than 15% over the next five years,” says Tan.
Shares in UOB closed 3 cents lower or 0.1% down at $25.67 on June 24.
