Avaloq, the banking and financial services software firm, finds that mainland China and Hong Kong like using WhatsApp and WeChat as a way to communicate with their advisors. However, in parts of the world there have been concerns about the privacy and security aspects of these platforms.
A study of investors in Hong Kong and mainland China shows that
they commonly use social media channels such as WeChat and
WhatsApp to contact financial advisors.
The findings, from Swiss banking software house Avaloq, come at a
time when regulators around the world have tightened the screws
on what is considered the inappropriate use of such platforms.
The Avaloq study of
investors showed that they are becoming more digitally attuned
and are turning to new sources of information.
Social messaging services such as WeChat and WhatsApp
are commonly used methods of communication with financial
advisors in both mainland China (51 per cent) and Hong Kong (39
“We have seen financial services in mainland China and Hong Kong
moving rapidly from branch to browser, and now to mobile app and
social media. Frequent communication on digital channels is
essential to meet the high expectations of investors. Banks and
wealth managers need to ensure a high degree of digital security
and privacy – in addition to an engaging and intuitive interface
– to help more investors make the switch to digital communication
channels,” Pascal Wengi, managing director for North Asia at
Among those investors who are not already communicating with
their advisor on social media, 74 per cent of respondents in
mainland China and 58 per cent in Hong Kong would be interested
in doing so if they knew that their conversations were completely
private and secure.
Such findings might give regulators concerns. For example, Morgan
Stanley in the US has been fined a sum of $200 million for “the
use of unapproved personal devices” as well as inadequate
record-keeping requirements. That fine came after US regulators
took similar action in December 2021 against JP Morgan, saying
that managing directors and senior supervisors had used WhatsApp
or personal email addresses for work-related communications.
Avaloq notes that “this trend towards conversational banking can
pose a compliance headache.”
In its statement about the survey, the firm said “relationship
managers therefore need a secure platform that facilitates
instant messaging with clients on popular social messaging apps
while ensuring privacy and compliance with record-keeping
While the survey confirms the position of industry professionals
as a trusted source of information for 66 per cent of mainland
investors and 50 per cent of Hong Kong investors, new data
sources are catching up fast: 36 per cent of respondents in
mainland China and 45 per cent in Hong Kong consult social media
when deciding how to invest.
Advances in mobile technology have greatly enhanced access to
portfolio information and frequency of communication. Some 41 per
cent of mainland Chinese investors and 27 per cent of Hong Kong
investors say that they engage with their investments at least
once a day, with a further 41 per cent and 45 per cent,
respectively, check their investments at least once per
Similarly, in the affluent to ultra-high net worth segment, 72
per cent of mainland Chinese investors and 39 per cent of Hong
Kong investors contact their advisor at least once per week. And,
if an advisor fails to communicate frequently enough, this is a
reason for 43 per cent of affluent to UHNW investors in mainland
China and 34 per cent in Hong Kong to consider switching.