Singapore’s wealth/ultra-rich population growth and digitalization activities in the wealth management area

6 mins read

Qinthara Fasya | 17 September 2021

Shilpi Chowdhary

Chief Executive Officer of Lighthouse Canton Pte Ltd

The pandemic hastened the digitalization trend throughout businesses, including the financial sector. The wealth management sector, in particular, is extremely relationship driven, with a lot of traveling and face-to-face interactions. So there was a need to interact remotely (a very fundamental requirement), and systems like Team, Zoom, and others made it incredibly easy to operate remotely while still getting things done. Lighthouse Canton’s systems were routinely audited for business continuity planning (BCP), and there was no better time than now to assess their resilience.

Shilpi Chowdhary, CEO of Lighthouse Canton, spoke with DigitalCFO Asia about how they have been working on digitizing operations and how the pandemic has accelerated their efforts to create a better client experience, more transparency and clarity for clients, and greater efficiencies for our Relationship Managers.

Digitising Operations within Financial Institutions

Messaging apps have been brought to the forefront as another way for relationship managers to communicate directly and securely with clients. While chat messaging itself is a fairly ordinary day-to-day technology, not many players in the industry are using it to its full potential. Even though clients were becoming increasingly used to conversing with their relationship managers through WhatsApp and WeChat, they still need to confirm their orders over phone or email.  We identified this as a point of friction within the client experience and wanted to make this as seamless as possible. Thus, not only have we now provided an official secure channel for clients to chat with their relationship managers, we have also integrated automation processes that allow for clients to place and confirm orders within the chat platforms. 

Remote working is becoming the norm and even though people were locked out of their offices for a long time, one could see the trading activity in the markets just shoot through the roof. This was all made possible by the ability of the systems to handle trades electronically and all the supporting systems and processes to work efficiently and smoothly.

Automation Processes that allow for Seamless Client Experiences

Trade reconciliations, order placements and confirmations, settlements, risk management systems etc are few of the things that are handled effectively with automation. 

Prior to the digitization of our operations, a lot of these were still being done via manual processes. Orders were taken and put manually into excel sheet trade blotters, emails were manually issued to clients to confirm orders, orders were sent by relationship managers to the custodians to execute and the trade blotters being updated to reflect the execution. For compliance, reconciliation and reporting purposes, compliance and operations teams would then need to gather and review all the individual documents and communications separately against the month end statements provided by custodians in different formats.

Digitization of operations and automation of these processes have since provided seamless experiences for both clients as well as the teams. When an order is placed now, details of the order is entered and stored centrally for the relationship manager, operations and compliance teams to review. An automatic email or WhatsApp/WeChat message with the order details is generated and sent to the client automatically for them to confirm the order to the system where it can be recorded and executed. Details of their trades and statements can now be reconciled daily using APIs with the custodians. With all the data being updated and pulled in automatically, reports and client statements can be generated on demand and in a standard easy to read format.  

Talent and Technology Challenges faces by the Wealth Management Industry

Talent is always in high demand and like any industry, Wealth Management faces a perineal problem on this front. There are few successful bankers, and they are always be in huge demand. The growth cycle for a Banker is also very long and hence there has to be a pipeline that can address this need. Unfortunately, this is not an easy problem to tackle. 

In addition to this, in this ever-shifting world the pace of change has accelerated. Clients are becoming more enabled with the use of technology and the financial industry has to keep pace to address their needs. The challenges on the technology front are more related to the applications in the wealth management space. There are number of solutions for the retail wealth clients who trade or invest in equities, funds and ETF’s however for the High Networth clients who like to buy bonds, Hedge Funds, Derivatives etc, the current technology platforms are inadequate and do not address their needs in totality. The user interface and onboarding experience leaves a lot to be desired.

We are also starting to see a rise in the next generation of wealth clients, as well as new age entrepreneurs who have generated wealth recently through their business endeavors. On this front, the industry needs new blood and new mindsets, a new age advisor. Clients of this ilk are digitally savvy, want to have more clarity and control over their investments, and are focused on how their investments can make an impact and how they can give back to their own ecosystems. This makes these clients very different to deal with compared to your regular wealth clients that most normal bankers are accustomed to, and so it takes someone with an equally entrepreneurial mindset to align with the client interests and find innovative investment solutions that integrate well with the client’s own philosophies, business plans and growth ambitions.

The digitization helps the clients in the region to work with platforms where it is reliable, and Singapore stands out because of the eco system and also because it supports the Fintech innovation in the Region. The number of startups that have gone on to do well in the wealth space are rising by the day and given Singapore’s regulatory framework and adherence to the rule of law, investors around the region trust these technology platforms. The banks in Singapore have also taken the lead in the digital solutions be it wealth management or other such services.

Digitization is also democratizing the landscape for investors. Investors are increasingly focused on clarity and control over their investments and are less keen on paying for mere execution. Digitization and tech enablement of the independent institutions and advisors means investors are able to get access to more holistic services and more innovative and intelligent financial solutions and are no longer limited by certain platforms or institutions.

How Lighthouse Canton Adapts to the Ever-Changing Wealth Management Industry

Lighthouse Canton is at the forefront of the digital adoption and leading key initiatives in that direction.

We have a mission to be the market leaders through people excellence, investment acumen and digital agility. 

As such, we are focused on building a culture of digital first. From identifying talent for new client segments, to providing innovative financial solutions and ways to service clients. We are doing this all by incorporating a digital first mindset. 

We are now one of the first independent investment institutions to offer chat messaging services to clients where they can interact directly with their relationship managers for their regular services, as well as authorize and place orders directly on chat platforms such as WeChat and WhatsApp through the integration with our Order Management System. 

Our Order Management System, as mentioned previously, is now fully digitized and has automation features built into it. By digitizing the system, we are also now probably one of the only independent investment institutions which can consolidate statements on daily basis from custodians directly by APIs. 

We have an automated portfolio construction tool that relationship managers can use to help clients discover new products based on their investment preferences and ambitions. 

Additionally, we have also built a complete digital journey to onboard clients more efficiently and securely, especially when handling sensitive documents. 

All of the above is the result of our client centric approach and digital first initiative at Lighthouse Canton.

About Lighthouse Canton

Lighthouse Canton Pte. Ltd. (LCPL)is a Singapore headquartered employee-owned global investment institution. Founded in 2014, it employs over 80 full time employees in Singapore, and across its subsidiaries in Dubai and India, overseeing over USD2billion (As of 31 March) of total assets under management and advisory. 

With decades of institutional specialised finance expertise and strong risk management track records, Lighthouse Canton serves an international client base of accredited private clients and institutional investors, offering both asset management capabilities across public and private markets as well as wealth advisory services.

Lighthouse Canton is regulated by Monetary Authority of Singapore (“MAS”), and registered as an Exempt Reporting Advisor (“ERA”) and a Commodity Pool Operator (“CPO”) in the United States, while its subsidiary in Dubai is regulated by Dubai Financial Services Authority (“DFSA”).

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