AIFS embrace digital shift as Covid lingers

Investment funds for the very rich, which traditionally set much store by in-person meetings with clients, are increasingly embracing a digital approach. Alternative investment funds (AIFS), which have a minimum investment of ~1 crore, are going fully digital in onboarding clients, which is unusual for the industry. At least three major asset managers are in the process of, or have already put in place digital protocols. This would allow very large investments to be made without any physical contact. These include ASK Investment Managers, Edelweiss Wealth Management, and Motilal Oswal Asset Management Company.

“Pre-pandemic, the process of account opening was done based on physical documents and there were multiple challenges faced such as mismatch between documents, incomplete documents, illegible handwritings… which made the average time taken to open an account… 5-7 days,” said Prateek Agrawal, business head and chief investment officer (CIO), ASK Investment Managers.

The firm had already launched a digital onboarding initiative for its portfolio management services, which reduced time taken for opening accounts by 3-4 days on average.

It has sought to replicate this for the AIF segment with an onboarding process that doesn’t require physical signatures. “The pandemic has led to greater acceptance of such digital processes,” said Agrawal.