Wealth Manager Opportunities and Challenges in Indonesia

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Have you ever heard of a wealth manager or wealth manager? For those of you who are taka sing with the world of finance and business, of course, the terms wealth management and wealth manager are certainly familiar. Especially if you are involve in this world.

However, for the people of Indonesia, the terms wealth management and wealth manager are still foreign and not widely heard. Though the existence of a wealth manager for people who belong to the rich can be said to be a must. Therefore, on this occasion we will review the wealth manager and the opportunities and challenges he faces in Indonesia.

What is Wealth Manager

According to the Certifie Wealth Managers’ Association (CWMA) formulation, a Wealth Manager is a specialist financial advisor, who helps mass affluent, high networth individuals (HNWIs), and small and medium-size business owners, or families, manage finances, from protecting to distributing all their wealth.

Wealth Managers usually have professional qualifications and degrees as a “Certifie Wealth Manager” (CWM) from the CWMA association or other professional titles from other similar associations and professional finance managers. Some of them are engage in the banking industry, insurance, capital markets and other financial services industries. This profession is classifie as elite and quite prestigious.

Currently, the services of Wealth Managers who manage wealth with simple investment allocations are easy to obtain, also at a fairly low cost. Some of them set costs base on the type of investment asset chosen, some apply fees base on time calculations, and some set fees base on the number of transactions, or even by applying a combination of the three cost components above.

In this day and age, the task of Wealth Managers is no longer only to determine the allocation of an investment, but also to help customers or clients in determining how these customers or clients will live in the future. How can they determine how many numbers are neede by their customers by determining what assets need to be develope to be able to protect and achieve the goals expecte by their customers.


Opportunities and Challenges

In Indonesia, currently, there is a Certifie Wealth Managers’ Association (CWMA), a non-profit and independent institution that aims to protect the interests of customers and to support the Wealth Management profession through education, research, product development and networking, both globally and locally. CWMA It is also a forum for Wealth Managers throughout the archipelago. As of July 2013, its members were only about 5,300 people. This figure is certainly not comparable to the Indonesian population which now amounts to about 250 million people.

This also proves that there are still many Wealth Managers neede to be able to help the needs of the people in Indonesia. Especially ahead of the ASEAN Economic Community (AEC) which will be implemente at the end of 2015. Not to mention the harsh competition facing unidentifie financial of ficer (UFO), namely foreign financial industry professionals from Hong Kong, Singapore, India and other countries.

Are wealth managers in Indonesia aware of their conditions and roles in facing the challenges mentioned above?

It should be realize that they are the ones who must answer this challenge, which is also an opportunity, by creating more competent Wealth Managers, not only in terms of knowledge (knowledge) and skills (skills), but also attitudes.

Wealth Managers Indonesia must be able to change the position and mindset of customers about themselves, so as to create credibility for the profession they carry. In order to achieve increase trust from customers in local Wealth Managers, a massive transformation is neede. Therefore, Wealth Managers in Indonesia must always improve the following: (1) mindset, (2) knowledge, (3) appearance, (4) attitude, (5) habits, (6) approach methods.

Not a few Wealth Managers who consider that any desire changes are not easy for them to do. There are also Wealth Managers who are reluctant to change precisely because they feel they are already in a safe zone and comfort zone. However, however, efforts must still be made so that the quality and performance of wealth managers can change towards the better.

Benefits for Customers

It is fortunate that a country that has many Wealth Managers who are competent. And loyal to serve their customers to achieve their expecte financial goals. The presence of Wealth Managers is expecte to provide a strategic asset allocation picture. So that customers can achieve their goals faster and more precisely. In addition. Wealth Managers are also expecte to be able to provide global advice to their customers. So that customers do not need to seek advice from distant and foreign sources.

With the help of customers by competent Wealth Managers, they will be able to also identify risks that can interfere with the achievement of expecte financial goals. Wealth Managers can also help customers in more comprehensive and in-depth financial planning.

Aspects of customer needs that are broad enough to make the scope of wealth manager work even wider. Therefore, a comprehensive, systematic, system approach is neede, and is able to meet all customer financial needs.


Why Are Indonesians Not Familiar with Wealth Management Products?

the wealth management business is growing along with the increasing population of the upper middle class. But in reality, the development is still far from what was expecte. The problem is, there are still many Indonesian people who do not know very well about wealth management products.

The development of clients in wealth management also cannot be said much. One of the biggest reasons is because socialization relate to wealth management services is still lacking. In fact, the OJK itself has done this socialization every day.

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As previously stated by Vera Margareth

Wealth Management and Insurance Product Head of PT Bank CIMB Niaga Tbk. Indonesians are still very familiar with savings or deposits only. Because it is claime to be safer and surer. In fact, it takes courage to take risks and also hope in order to get higher profits.

Once again, the potential of wealth management business in Indonesia itself is still very large and wide open. But people’s knowledge relate to this service is still very little. There is a need for socialization and service approaches to the community that are better and improve. So that the people of Indonesia are not left behind in utilizing this wealth management product.

The behavior of Indonesian customers is almost no different from customers in other regions in Asia. In other words, it is still strongly driven by transactions, trade orientation, and of course yield orientation. As well as, lastly, government bonds, which give high yields. In addition, Indonesia, which is a muslim-majority country, Sharia products. And Sharia solutions must be further sharpene for the market, both for investment and insurance.

Therefore, the most important thing for the people of Indonesia today is the existence of financial education. Not only from the perspective of making money, but about connecting it to a higher goal in life. This is the duty of the financial institution. So, whatever is designe, whether for retirement funds or children’s education, financial institutions. And banks have an important role in initiating and providing direction for its future development.

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