Say Hello to Your New Financial Aide - Robo Advisory Wealth management is among the least sought after financial services in the Indian market. However, things are now shaping up due to robo advisory

By Vanita D'souza

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From lending to saving, fintech companies are revolutionizing every service that the finance sector has on offer, and the wealth management industry is not immune to this disruption. Robo advisors work with minimum human intervention as from financial planning to risk profiling to the recommendation and transaction everything is done digitally. Digitalization also reduces the cost of servicing the client, making it a financially viable business model among fintech start-ups.

About the opportunity in the Indian market, Dinesh Rohira, CEO and founder of says that robo advisory services are still in their nascent stage in India, advisory itself is yet to take centre stage. "Majority of the investment decisions are still driven by recommendations and tips from family and friend connections. A structured, professional and systematic approach towards financial planning and advisory-led decisions are at a nascent phase in India. With about 5-6 per cent penetration levels in India, the only way to services and drive higher adoption is with the help of technology, robo advisory is expected to play that role in the next five years," he explains.

The segment, however, is on the rise as more and more people are adapting to the digital financial services. According to Statista, Indian robo advisors are currently managing assets worth $20 million in 2018 and the number is expected to shoot up to $116 million by 2022 with CAGR of 54.4 per cent (2018-2020).

FundsIndia's COO and co-founder, Srikanth Meenakshi feels that people who prioritize speed and convenience over thoroughness and full personalization rely more on robo advisory as opposed to people who want human guidance. "In due course, as the products and platforms become more sophisticated, the market acceptance will increase, and from a business point of view, the reverse is also true," he points out. But what is fueling the growth of the fintech segment? Entrepreneur evaluates key trends that are lifting the spirits high among robo advisory start-ups in India.


India's youth comprises the majority of its population. This youth population is also the part of the workforce and understands the importance of investing elsewhere other than traditional assets like gold and property. Gen Z has a better risktaking appetite as opposed to the previous generation and it actively participates in the capital market through stocks or mutual funds.

However, Prakarsh Gagdani, CEO, 5paisa. com says that they also tend to get bemused due to the availability of a plethora of stocks and funds. "This is where customized advisory cuts through the clutter and provides them investment advice in minutes. This is how robo advisory services on platforms like ours are gaining traction," he asserts.


Apart from the ease of use, access and simplification, Rohira says that financialization of investment options has also played a key role in driving and facilitating the growth of the robo advisory industry. He says post-demonetisation, all other options such as fixed deposits, real estate and gold have turned out to be imprudent for investments. And these have remained traditional areas of interest for the retail segment.

"However, with these instruments losing their attraction, equity-linked instruments have been the primary trend for investments and this requires one to look for a professional advisory recommendation for the majority of the retail segment," Rohira shares. He adds, "This trend is now driving the growth of adoption for the robo advisors among the retail segment. It's also enabling and introducing them to a structured approach toward long-term planning for their goals."


The growth of the mutual fund industry due to the Association of Mutual Funds in India (AMFI) campaign has been the biggest enabler for this industry. In March 2017, the AMFI launched the Mutual Funds Sahi Hai campaign to break the myth related to the investment product.

The campaign was considered to be one of the best drives of the decade as within a span of a year more than 50 lakh new investors were registered. Meenakshi feels one can call it a good bootstrap go-to-market campaign for these services. However, going forward, the services will need to stand on their own and flourish on the merits of their offerings, especially in the fiercely competitive environment of this era.

(This article was first published in the September 2018 issue of Entrepreneur Magazine. To subscribe, click here)

Vanita D'souza

Former Senior Correspondent, Entrepreneur India

I am a Mumbai-based journalist and have worked with media companies like The Dollar Business Magazine, Business Standard, etc.While on the other side, I am an avid reader who is a travel freak and has accepted foodism as my religion.

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