“It's so we continue to offer reliable, high-quality service. It's being able to improve our products alongside the tech trends, the market trends, but also innovation.
“We're incredibly lucky we get that funding and that resource to constantly keep ourselves up to date with technology and trends.”
Indeed, while companies in the financial services industry and beyond are thinking about incorporating, or beginning to incorporate, artificial intelligence into business practices, the tech provider has been offering machine learning models to wealth managers since 2020 via its Insight product, which can offer recommendations tailored to individual clients.
The models use data such as a client’s age, attitude to risk and investment goals, product preferences of previous clients with a similar profile, and in-house investment research, which is processed by algorithms to make a recommendation for a wealth manager’s approval before it is presented to the client.
Despite this, Rao says Avaloq is not a niche vendor that builds AI products, but that its Insight product – a data analytics platform that consolidates data from Avaloq systems and third-party systems – enables clients to further employ AI.
“If you look at some of our clients – the universal banks all the way through to the small regional wealth managers – they sit on a lot of data.
"So we've invested an enormous amount in our data foundation layer [Avaloq Insight], which gives access to real-time data in an understandable format.
“AI is as good as the data that you give it. It's then giving the possibility to our client base, with what we can do with the data foundation layer and analytics platform, so then they can go away and make use of the AI piece.”
But to leverage and take advantage of AI in a regulated space will require a lot of thinking from clients, Rao adds. “And genuinely, they are thinking. I can see it, because it starts off with the data.”
Avaloq may not be a niche tech vendor that builds AI products at the moment, but when asked whether Avaloq’s future in the UK wealth management industry could involve developing AI applications, the short answer, Rao says, is yes.
Chloe Cheung is a senior features writer at FT Adviser
