"Financial inclusion" and "democratisation" of wealth are, hopefully, more than just fancy marketing terms. The author of this article examines the role of wealth management in widening access to financial services – often by new business models and technology.

This article examines the topic of financial inclusion. Given the often politically charged discussions today about wealth inequality, fairness and concerns about opportunity, the sector cannot ignore the wider conversations that drive policy on issues such as tax and the role of government. But beyond that, there is the potential for technology and business models to improve access to financial services, creating new opportunities.

These topics are important in a year of so many elections around the world.

To discuss such matters is Philipp Buschmann, chief executive, and co-founder of AAZZUR, a Berlin-based business (there is also a UK operation, AAZZUR UK). The firm helps businesses build financial services.

The editors are pleased to share these views; the usual editorial disclaimers apply to guest material. Please get involved in the conversation! Email tom.burroughes@wealthbriefing.com

The strive for a more financially equal society has, unfortunately, not shifted for everyone. In economic turmoil, the gap between the rich and the poor becomes more apparent and unravels the disproportionate resources that are available to only a few. Wealth management is crucial, whether you oversee running your household or a business, and when done effectively it is instrumental in wealth distribution, closing the gap and widening opportunity. This article will explore the pivotal role wealth management plays in wealth distribution and the strategies that can be implemented to make a positive contribution to your personal growth and society’s betterment.

Facilitating financial inclusion
The 2008 global financial crisis eroded confidence in traditional banking institutions and, together with the broad-based rise in digitalisation, kickstarted what we now recognise as the fintech industry. The social injustice and the damaging consequences of poor financial education and opportunity were not being challenged enough. Fintech innovations have been instrumental in democratising access to financial markets, investment opportunities, and financial advice. 

From just the small screen on your phone, a whole world of financial education can be discovered. Platforms are popping up all the time offering low-cost investment options, micro-investment opportunities, and educational resources to empower individuals with even modest means to start building wealth. The beauty of modern technology is that it is much more accessible, so very few are excluded from the opportunities that embedded wealth management products offer.

In addition, thanks to technological advancement, digital banks are reaching unbanked populations and putting them on a path to financial security. Wealth management, when approached inclusively, seeks to break down these barriers by providing avenues for individuals from all walks of life to participate in wealth-building activities.

Fostering social capital
We talk so much about personalisation in the embedded finance space because that is the epicentre of every decision we make as innovators. In wealth management, while naturally most of the conversations resort to maximising financial return, it is not or should not be the only goal. Impact investing is not just a cool buzzword but signifies the growing trend we have seen develop in society as people look for ways to manage their wealth ethically. Whether for social, political, or environmental reasons, impact investing has been an important driver in making this change.

This is nothing new to professionals within the wealth management space, as they often play a role in philanthropy and social impact investing. They have forged key relationships with their clientele and, as a result, they are directing capital towards initiatives their clients feel passionate about and that promote economic inclusion. Embedded finance champions wider access to capital, making resources readily available regardless of where you bank. Wealth managers are making positive change because they value a personalised service and want to keep customers content and loyal, as well as making wealth distribution a reality.

In summary, the decentralisation and democratisation of wealth can be hugely impactful, as much-needed capital can be directed towards initiatives that address pressing societal challenges such as climate change, alleviating poverty, and access to healthcare. Wealth managers can play a pivotal role in driving positive wealth distribution. Impact investments not only generate returns for investors but also contribute to the creation of wealth in underserved communities. 

Empowering entrepreneurship and innovation
According to a recent survey carried out by The Global Entrepreneurship Monitor, there are approximately 582 million entrepreneurs across the globe. 

Entrepreneurship serves as a gateway for wealth creation. However, aspiring entrepreneurs often face significant barriers, including limited access to capital and advisory support. Wealth management, particularly through venture capital and angel investing, can bridge this gap by providing funding and connecting founders to mentors based on their profile. 

Furthermore, wealth managers can support entrepreneurship within marginalised communities by fostering inclusive investment ecosystems. For example, Triodos is a pioneer in ethical banking, focusing on sustainable economic development. Triodos supports SMEs that contribute positively to their communities, including those led by marginalised groups. They provide loans and equity to businesses in sectors such as organic food, renewable energy, and social housing, which typically involve entrepreneurs from underrepresented groups. By seeking out diverse founders and supporting initiatives aimed at promoting economic empowerment, wealth managers can contribute to a more equitable distribution of wealth across society.

Educating and empowering clients
Financial literacy is a cornerstone of effective wealth management and wealth distribution. Many individuals, regardless of their income level, lack the necessary knowledge and skills to make informed financial decisions. Wealth managers have a responsibility to educate and empower their clients, equipping them with the tools and knowledge needed to build and preserve wealth over the long term. 

Data analytics, CCM (Customer Communications Management Software) tools and management software can be taught to employees with the support of senior staff. There can often be a gap in knowledge when it comes to technology in business, so it is imperative that training is thorough, so customers aren’t left in the dark.

Through personalised financial planning, investment education, and ongoing guidance, wealth managers can help clients navigate complex financial landscapes and make decisions aligned with their financial goals. By promoting financial literacy and empowerment, wealth managers can foster a culture of responsible wealth management and contribute to more equitable wealth distribution.

Advocating for policy change
Interestingly, wealth managers wield significant influence not only within financial markets but also in shaping public policy. By leveraging their expertise and resources, wealth managers can advocate for policies that promote economic equality, social mobility, and inclusive wealth distribution.

This may involve supporting initiatives such as progressive taxation, equitable access to education and healthcare, and social welfare programmes aimed at reducing wealth disparities. By actively engaging in policy advocacy, wealth managers can drive systemic change and create an environment conducive to more equitable wealth distribution.

Wealth management is far more than a tool for maximising financial returns – it is a critical driver of wealth distribution and societal prosperity. Through inclusive practices, impact investing, support for entrepreneurship, financial education, and policy advocacy, wealth managers can play a transformative role in shaping a more equitable distribution of wealth.

As we navigate an increasingly interconnected and interdependent world, the importance of responsible wealth management in promoting inclusive growth and prosperity cannot be overstated. By embracing technology and embedded solutions, wealth managers can make a meaningful difference in the lives of individuals and communities around the globe and empower the next generation of entrepreneurs in their quest for wealth creation.

About the author 
Philipp Buschmann is co-founder and CEO at AAZZUR, a firm providing a “one-stop-shop” for “smart embedded finance experience.”  
 
A serial entrepreneur, Buschmann has worked in fields such as challenger banking, financial services, IT and energy. One of his firms, Ignis Petroleum, has been publicly listed in the US and Germany.  
 
He holds an MBA from the London Business School. He is also a speaker at major events around fintech.