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Singapore robo adviser Endowus to improve wealth platform, eyes foreign expansion

robo-advisor image with businessman closeup showing growth
By Goh Thean Eu   
June 26, 2020

Singapore’s Endowus, the first robo adviser in the city state to offer products via the Central Provident Fund Investment Scheme (CPFIS), will focus on improving its digital wealth platform over the next two years, and look to expand abroad within five years.

According to Chief Executive Officer Gregory Van, the company wants to build a “holistic wealth platform that offers advice serviced by multitude of products” that can help address investor needs at various life stages.

“Our five-year roadmap includes operating in different countries, and scaling our user growth as one of the largest digital wealth platforms in Asia,” Mr. Van says in an interview with Asia Asset Management.

In spite of the fact that the coronavirus pandemic has made this a challenging year, he says there was no significant impact on Endowus’s business and its customers’ investments.

“We saw an uptick in accounts created and little to no change in the investments held on Endowus – which is a testament to our investment strategy,” he says.

Mr. Van says Endowus launched two products this year, including a fund that can be invested via the CPFIS, its eighth product in the scheme. It’s also developing a mobile app which is slated for release in the third quarter.

Central Provident Fund members can invest all but S$20,000 (US$14,407) of savings in their ordinary accounts in any investment products under the CPFIS.

According to Mr. Van, it wasn’t easy to create an end-to-end solution for the scheme, including brokerage, advisory, access to products and rebalancing services.

He says Endowus worked for two years with the pension fund, Singapore’s manpower ministry, and local securities firm UOB Kay Hian in order to launch a solution within the CPFIS framework and regulations.

“Taking two years to ensure that our clients have the best chance to succeed as well as an interest-aligned adviser working for them is a worthy investment for us as a business,” he says.

Endowus, which was established in 2017, is competing in an increasingly crowded industry. Singapore now has more than ten robo advisers serving a population of 5.7 million. Endowus’s rivals include StashAway, AutoWealth, Smartly and MoneyOwl.

The robo advisers are also competing against traditional banks such as Oversea-Chinese Banking Corp and DBS Bank that offer digital investment services.

According to Mr. Van, differentiation and marketing efficiency “are critical” to remain competitive.

“Focusing on the pockets of money, such as CPF, that are organically growing and will make a meaningful difference to people’s lives will be critical to the success of a mission-driven business such as Endowus,” he says.

Endowus doesn’t publish its assets data. According to Mr. Van, its customer base and assets under management surged “over 1,000%” year-on-year in 2019.