Wealth Management - South Africa | Statista Market Forecast

Assets under Management in the Wealth Management market are projected to reach US$601.90bn in 2024.
Financial Advisory dominates the market with a projected market volume of US$594.30bn in 2024.
Assets under Management are expected to show an annual growth rate (CAGR 2024-2029) of 0.48%, resulting in a market volume of US$616.40bn by 2029.

Definition:

Wealth management is a service provided by financial institutions, such as banks or investment firms, to help individuals manage their money and investments. The goal of wealth management is to help people grow and protect their wealth over time, by creating personalized investment plans that consider their financial goals, risk tolerance, and overall financial situation. This goal ultimately emphasizes wealth creation through wealth preservation.

Structure:

The Wealth Management market consists of two different segments, Financial Advisory and Digital Investment. Financial Advisory covers traditional financial advisory services and provides a broader look into the revenue generated by this offering. Digital Investment contains automated investment services (Robo-Advisors) and online trading services (Neobrokers) that go beyond the means of traditional financial advisory services.

Additional information:

The market comprises of revenues, number of advisors, average revenue per advisor, assets under management (AUM), users, average revenue per user, and average AUM per user. Revenues are generated through the financial advisory services offered by the financial institutions within the Wealth Management market space. The market only displays B2C revenues and users for the above-mentioned segments and subsegments; B2B and B2G revenues are not included. Additional definitions for each segment can be found on the respective segment pages.
Market numbers for Digital Investment are also featured among our digital markets, namely in the Digital Investment segment of the Fintech market.
Key players in the market include financial institutions such as BlackRock, Vanguard Group, Fidelity Investments, State Street Global, and J.P. Morgan Chase & Co.

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Traditional & Digital Wealth Management (non-automated & automated wealth management services)
Traditional Investment, incl. Financial Advisors
Banks, Financial Institutions, and Financial Services Companies
Digital Investment, incl. Robo-advisors and Neobrokers
Full-Service Products for Investing and Trading
Retail/Non-Professional Investors

Commercial Assets or Assets Under Custody
Independent Financial Advisory Companies
Independent Financial Advisors (IFAs)
Full-Service Products for Insurance and Lending

The Wealth Management market in South Africa is experiencing significant growth and development, driven by various factors such as changing customer preferences, emerging trends in the market, local special circumstances, and underlying macroeconomic factors. Customer preferences in the Wealth Management market in South Africa are shifting towards personalized and holistic financial solutions.

Clients are seeking tailored investment strategies that align with their individual goals and risk tolerance. They are also demanding more transparency and accountability from wealth management firms, as well as access to a wide range of investment options. Additionally, there is a growing demand for sustainable and socially responsible investment opportunities, as clients are becoming more conscious of the impact their investments have on the environment and society.

Trends in the market are further shaping the development of the Wealth Management industry in South Africa. One notable trend is the increasing adoption of digital technology in wealth management services. Firms are leveraging digital platforms to enhance client engagement, streamline processes, and deliver more efficient and cost-effective services.

This trend is driven by the growing tech-savvy population and the need for convenient and accessible wealth management solutions. Another trend is the rise of robo-advisors, which provide automated investment advice and portfolio management services. Robo-advisors are gaining popularity among younger investors who prefer low-cost and technology-driven solutions.

Local special circumstances also play a role in the development of the Wealth Management market in South Africa. The country has a large and growing middle class, with an increasing number of individuals accumulating wealth and seeking professional financial advice. This presents a significant opportunity for wealth management firms to expand their client base and cater to the needs of this emerging market segment.

Additionally, South Africa has a well-established financial services sector, with a strong regulatory framework and a robust banking system. This provides a stable and conducive environment for wealth management firms to operate and grow their businesses. Underlying macroeconomic factors also contribute to the growth of the Wealth Management market in South Africa.

The country has a relatively stable economy, supported by a diversified and resilient financial sector. The government's focus on economic development and infrastructure investment further stimulates wealth creation and investment opportunities. Additionally, South Africa is strategically located in the African continent, which is experiencing rapid economic growth and increasing investor interest.

This presents opportunities for wealth management firms to tap into the growing African market and expand their reach beyond the borders of South Africa. In conclusion, the Wealth Management market in South Africa is developing and evolving to meet the changing needs and preferences of customers. The market is driven by customer demands for personalized and holistic financial solutions, as well as emerging trends such as digitalization and the rise of robo-advisors.

Local special circumstances, including the growing middle class and a well-established financial services sector, provide a favorable environment for the growth of the Wealth Management industry. Furthermore, underlying macroeconomic factors, such as a stable economy and strategic location, contribute to the overall development of the market.

Data coverage:

The data encompasses B2C enterprises. The figures are based on gross revenues, assets under management, and user & advisor data of relevant services and products offered within the Wealth Management market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research activities (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as: GDP, gross national income (GNI), consumer spending, total investment (% of GDP), high income (% of population), and number of high-net-worth individuals (HNWI). This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development).

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Private wealth management has developed significantly in recent years as a result of the growth of affluence worldwide. The number of millionaires in North America more than doubled between 2010 and 2022. A similar trend can be observed in the Asia-Pacific and Europe. The total wealth of the adult population in Europe has steadily increased since 2010. Private Wealth Management is an increasingly important service as the rate of wealth continues to increase among the general population and affluent high-net-worth-individuals. Coupled with the recent developments in the Fintech market, this has helped to open up new Private Wealth Management products and services to people with smaller amounts of disposable income and expanding services offered to larger clients.