Personalisation at the heart of DBS's financial planning push

WHAT do younger Singaporeans want from their banks? A lot more hand-holding in financial planning, according to DBS - but send help via digital tools please, not through a financial adviser.

As a senior executive from the bank observed, some consumers prefer navigating their money matters privately. This is understandably so; personal finance is more personal than finance, closely tied to one's individual goals and dreams.

"Some people don't want others to know that they don't know how to invest, or something as 'simple' as setting up the habit of saving regularly. It's understandable and technology helps in this area because they're guided to start," said Evy Wee, DBS head of financial planning, investments and insurance solutions.

As an example, the number of customers who completed their investment journeys grew 4 times when initiated through the bank's artificial intelligence-powered digital investment advisory tool launched in April.

Some 2.6 million customers (mostly millennials and Gen Zs) have used the bank's financial planning platform NAV Planner, of which 35 per cent are active users - more than double from a year ago.

This is in part helped by the launch of SGFinDex last December. About 150,000 Singaporeans have signed up to consolidate their financial data across participating banks, and DBS holds over 80 per cent share of the total number of users.

Investment data from the Central Depository was the latest to be included via SGFinDex, with insurance to be added next.

With more pooled data available, hyper-personalisation is a key focus in NAV Planner's next phase of growth as the bank sharpens its advisory tools.

This comes as part of a broader goal to get a million retail customers insured and invested by 2023.

Today, the level of personalisation that consumers expect from their banks go beyond just retirement calculators and broad-based product recommendations.

The younger generation, in particular, care more about personalisation - 8 in 10 Gen Z consumers surveyed said it could deepen their relationships with banks, compared with less than half of consumers over the age of 65, a recent report by EY showed.

Consumers must leave every interaction thinking "my bank knows me well and treats me like an individual with unique needs", said EY.

For now, the various "pillars" on DBS's NAV Planner are largely left to customers to explore on their own. Most of the nudges, although personalised, appear as broad insights at the bottom of the dashboard, said Wee.

The bank is working to build more guided journeys and personalised dashboards, which also include embedding specific nudges into the experience, customised according to one's unique financial situation.

"This will hand-hold the consumer to a point where they can be comfortable doing it on their own," said Wee.

If a customer has a cash-flow problem, for example, there is not much use in pushing investment, protection and retirement insights no matter how important, she added.

"So we (tweaked) their main dashboard on NAV Planner, and only showed them their cash flow, budgeting and spending categories and hid everything else because we felt they might be overwhelmed to even start. As a result, we have seen dormant customers become active."

On average, users guided by the NAV Planner have a higher deposit balance of at least 40 per cent more, and higher investment AUM (assets under management) of at least 4 times more, compared to non/dormant users.

As retail investing booms, there is a need to look at the suitability of investments with a new lens as more consumers participate in the financial markets, said Wee.

DBS has projected for total AUM of digitally managed investments to grow by S$2 billion by this December. This includes robo-advisory service digiPortfolio, unit trusts and DBS/POSB Invest Saver ETFs but excluding equities and FX.

As at September, the number of digiPortfolio transactions (new portfolios and top-ups) more than doubled year on year.

The bank is now looking to tap customers' monthly cash-flow data when recommending products to ensure they are investing within their means.

While some customers may have sufficient investment knowledge and pass all "tests" within the bank's digital advisory tool, they may not be in the right financial situation to invest, Wee observed.

Meanwhile, customers who want to draw down on their financial assets as they enter their twilight years or replace their regular income can be guided via a new decumulation-related feature in 2022.

The longer-term goal, said Wee, is to fully integrate all financial planning tools and data on NAV Planner to help customers make more realistic assessments of their life goals.

As it is, the four key pillars of investments, insurance, savings and retirement planning are not mutually exclusive.

Wee said: "Up until now, you usually create a goal or several goals, and someone helps you to plan it out as part of a whole journey. I won't say we can replicate the full experience of consulting a wealth planning manager altogether, but the idea is to help customers think through (their decisions) more carefully."