Bairong Inc. (“Bairong” or “the Company”, 6608.HK), a leading independent AI-powered technology platform in China, called on banks in China to speed up the digitalization of their wealth management businesses to meet the growing demand from the burgeoning middle-class families.

It is expected that the total assets of personal wealth management in China will increase by 10% annually from 2021 to 2025, according to a study published by McKinsey.

“With the fast development of AI, 5G, blockchain, and virtual technology, the finance industry should leverage cutting-edge technologies for the digital transformation, and it is imperative for banks to digitalize their wealth management business as the market is undergoing significant changes,” said Chen Liyu, senior vice president of Bairong at a recent industry event in QingdaoShandong Province.

The digital capability has become a key driver for financial institutions to boost the wealth management business. The digitalization of services will spur the total assets of wealth management to increase by 25% to 50%, and help financial institutions grow their revenues by 15% to 30% and profits by 25% to 50%, according to a report by Boston Consulting Group.

As banks in China have been racing to transform their businesses with digital technologies, the monthly active users (MAU) have become the primary target over the past few years, and almost everything insides banks has been mobilized to reach the MAU target, including sales and marketing, operations, procedure, risk management, and organization structure.

“Over the next decade, the asset under management (AUM), instead of MAU, will become the primary target for banks in China,” said Chen Liyu. “This change of target will bring significant consequences for banks in their strategic planning, sales and marketing model, operations management, and even corporate culture.”

Facing the new trend, financial institutions will need to leverage digital technologies to expand the services, reduce reliance on star managers, enlarge customer coverage, and improve collaboration efficiency, which will help them reach both MAU and AUM targets, added Chen Liyu.

With the leading technology platform to empower financial institutions, Bairong is committed to supporting the digital transformation of China’s financial industry. With smart analytics services and solutions covering the whole business process, Bairong’s client base includes the majority of state-owned banks, regional banks, consumer finance companies and main insurance companies. By the end of the first quarter of 2022, the Company provided services to 5,900 FSP clients in China, including 3,501 paying FSP clients.