Fewer than 10% of UK adults receive formal investment advice, with cost remaining a key barrier, new research from PwC has shown. But tokenization may offer a solution.
Despite a focus on digital transformation to develop more accessible and cost-effective offerings, limited progress has been made.
PWC said that even among engaged investors, disparities exist. Private market access remains limited to large institutional clients and high net worth individuals, while less wealthy individuals are restricted to a narrower set of predominantly public investments such as mutual funds and exchange-traded funds.
Furthermore, a large number of funds have opaque and complicated fee structures, despite fee transparency mattering most for 72% of investors when choosing a wealth manager.
However, tokenization, while nascent, is developing rapidly and may help to remove some restrictions of more traditional fund structures, PwC said.
In its report, the firm said: “Technological advances have also started to create opportunities to broaden accessibility to historical exclusive investment sectors.
“The pandemic induced shift towards digital servicing has helped cement customer understanding of investment products. While the war in Ukraine has created significant levels of uncertainty and compounded existing inflationary pressures, the impact of the pandemic on disposable income and digital adoption has increased retail investors’ willingness to engage with investment propositions.”
PwC said investors are also increasingly looking beyond returns when assessing investment opportunities and considering ESG factors such as climate change and social inequality. According to another survey by PwC, 82% of asset managers now have an ESG programme and for 81%, their goal is to use these programmes to drive transformational change in their firm-wide approach to ESG.
[Main image: markus-spiske-QozzJpFZ2lg-unsplash]
