As the concept of robo-advisory seeps into China, third party wealth managers are emerging and challenging the existing market landscape. Lufax, born in 2011 inside Ping An Group, spotted humongous opportunities lying in China’s asset and wealth management industry.
“A majority of Chinese investors started their investment in stock markets, where they picked up the habit to follow the market movement closely,” says Jinliang Mao, chief technology officer at Lufax. “But when you invest in funds and invest with us, you don’t have to do that all the time. You just need to have an investment strategy that matches your personality and risk appetite.”
“We use technology to subtly nudge investors to balance out the risk and movement in their portfolios through diversification, and help them arrive at the understanding that a long investment horizon will do better.”
One cutting edge of Lufax is the abundance and depth of its customer behaviour data. As customer data is shared across all Ping An subsidiaries internally, such as Ping An Insurance and Ping An Bank, Lufax has a holistic understanding of their customers’ financial capability and intention.
In July 2019, Lufax introduced a Know Your Intention (KYI) module to its intelligent wealth management interface at Ping An Group’s inaugural Smart Ecosystem Conference. Built upon Natural Language Understanding (NLU) and look-alike modelling, Lufax’s KYI is able to better understand customers’ needs and intents through textual and contextual analyses, and represents a major step toward a higher level of intelligence in financial and wealth management services.
Leveraging big data technology, Lufax facilitate intelligent risk matching with accurate user profile and in-depth market intelligence. Unlike peers that use questionnaire for KYC, Lufax’s KYC and KYP systems are dynamic and updated with real-time changes, including every new transaction.
“When we match investors with products, we take into account their risk appetite and risk tolerance, or the ability to absorb risk. We look out for investors and alert them when their choice is a mismatch with their risk profile,” Mao says.
On the other hand, readiness of mobile app is key to win tech-savvy customers in China. Through the Lufax mobile app and lu.com, Lufax customers are able to use their integrated smart accounts to access financial information, make investments, and manage cash flow. The on-boarding process on the Lufax platform now takes just five minutes.
The financial intelligence and a user-friendly interface have attracted a significant number of users and partners over the past few years. More than 6000 funds, and more than 1000 domestic and international financial institution partners are available on Lufax’s platform. As of September 2019, Lufax serves more than 43.39 million users and the AI-empowered chatbot conducts most customer enquiries.
“We are hard at work to improve and refine our chatbot, and through it bring the kind of premium services previously only enjoyed by VIP customers to the rest of our investor community,” Mao adds.