Why Account Aggregation is Required for Wealth Management

Wealth platforms and advisors must source a full and accurate picture of an investor’s finances— both held and held-away—as a starting point for actionable insights and personalized financial advice. Problems arise when parts of that picture are missing or obscured due to incomplete data. The result is missed opportunities to bring assets under management, the need for manual reconciliation, wasted internal resources, and the erosion of trust.

Creating a complete financial picture poses significant challenges for wealth technology platforms due to several key factors:

Limitations in Acquiring Comprehensive Data - Most wealth management platforms only collect advisor-managed account data from major institutions, leaving numerous others unaccounted for. Additionally, there is a gap in coverage for investors’ held-away financial account data, and without it, advisors are left with only a partial understanding of their clients’ financial picture.
Cost of Connectivity Maintenance - Managing connections with financial institutions is expensive and complex, further compounded by evolving open banking regulations. Regular updates to meet these regulations and maintain data security demand significant investment in technology and expertise.
Challenges in Standardizing Financial Data - Deciphering abbreviations, descriptions, and inconsistencies across diverse financial data providers and standardizing these into a normalized data model poses a significant challenge.

Fortunately, account aggregators can effectively solve for these problems. Partnering with an aggregator enables enterprises and wealthtechs to allocate their finite resources wisely and focus on their core strengths while outsourcing the complexities of maintaining a data connectivity network, developing data expertise, and staying abreast of the dynamic open banking landscape. This strategic collaboration allows enterprises and wealthtechs to prioritize innovation and client-centric services.

What are the Benefits of Account Aggregation for Wealth Management?

User Persona	Key Benefits
Investors	• View a complete financial picture and net worth • Receive more actionable and personalized guidance • Gauge progress toward financial health goals
Advisors	• Build strong relationships and provide personalized advice • Grow assets under management and assets under advisement • Increase efficiency through automated data collection
Wealthtech Platforms	• Increase assets under management • Enable a superior user experience • Cost-efficiently scale for a growing business