Hargreaves Lansdown highlights £4trn ‘wealth opportunity’ for investment providers
Consumers are now expecting the same user experience that they get with Amazon when investing, Hargreaves Lansdown claims.
The investment powerhouse said the pandemic has changed the way investors interact with their investments and more communication and support is now expected from providers.
Chris Hill, chief executive of Hargreaves Lansdown said the pandemic has reminded society and individuals about the importance of financial resilience.
His forecasts also highlight opportunities for peer-to-peer lenders.
He predicted that by 2026 alone, the total UK addressable wealth and cash market opportunity for investment providers will be around £4trn and is set to grow further.
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“Client expectations and demands have been accelerated by the pandemic,” he said.
“They no longer compare just to other wealth managers or financial services companies, but to the customer experience offered by the likes of Amazon.”
Hill also highlighted an opportunity for investment providers due to the regulator’s greater focus on client outcomes and investment, particularly where people hold too much money in cash when they have enough risk appetite to invest.
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“The regulator has a clear focus on client outcomes and the value of long-term investing,” Hill said.
“Its recent consumer strategy recognises the need for people to participate in markets with a specific target of a 20 per cent reduction in the number of consumers with higher risk tolerance holding over £10,000 in cash by 2025.
“This is equivalent to 1.7 million people.”
It comes as Hargreaves Lansdown’s interim results for the six months to the end of December 2021 showed assets under administration rose 17 per cent annually to £141.2bn and the number of active clients hit 1.7m.
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