Middle East Wealth Management Forum 2020 - Exclusive Insights - Prashant Tandon

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1. What are some of the common challenges for the IAMs/MFOs today?

Video transcript

1. What are some of the common challenges for the IAMs/MFOs today?

We can look at this question in two or three different perspectives. The first challenge is, how does one remain relevant? As the industry becomes more and more competitive, clients become more sophisticated in their requirements and spoiled for choice. Clearly the first challenge is how does one maintain the USP and remain relevant for clients? That is where having a cutting-edge offering, a differentiated product advisory suite, and obviously having a very, very transparent and client-driven culture becomes very, very important. That is the first challenge that the MFOs will face. The second challenge we face in the industry is going to be commercial. As the early entrants focus more on the sustainability and cashflow, and hence fall into, so-called, the easy way out of going through a commission or retrocession-driven route. The more evolved model has to be a fee-driven model, which is regulatorily more acceptable. This is reflected even outside the financial services industry. As you see, the valuation of Tesla compared to industry peers is far higher, simply because they are in the right direction. So, I believe industry peers who align with the future and become a more transparent client-centric offering with a fee-driven mandate will tend to do well.



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