One of Singapore's oldest and most well-established robo-advisors is shutting down amid «intense competition.»
«Competition in the digital investment advisory space is intense and maintaining a high service standard on the platform has been challenging,» the firm said in an announcement on its website on Wednesday.
Smartly said that it considered introducing «core platform improvements» but strategic corporate considerations by parent company VinaCapital Group ultimately guided its decision to shut down.
Stiff Competition
While there was no minimum investment, Smartly's management fee was only competitive for accounts with more than S$10,000. It charged 1 percent for accounts below this sum, with fees dropping to 0.5 percent for accounts above S$100,000.
Founded by Estonian partners entrepreneur Keir Veskiväli and investment analyst Artur Luhaaar in 2016, the firm was later acquired by the parent company of MAS-licensed investment brokerage VCG Partners.
It has seen stiff competition from a slew of fintechs that have entered the robo-advisory space such as Stashaway and Kristal. Traditional banks have also joined the fray, with OCBC launching Roboinvest in 2018, and DBS rolling out its «digiportfolio» in 2019 for retail clients. Earlier this year, Grab announced it was moving into wealth management with the acquisition robo-advisory startup Bento.
Consolidation Expected
Fintechs promising retail investors low-cost, diversified, passive investing have proliferated in recent years. According to Statista, assets under management among robo-advisors in Singapore reached $4.5 billion in 2020 (49.2 percent growth year-on-year), with 265,000 users (39.6 percent growth year-on-year).
As profitability is strongly related to scalability and high volumes under management, Statista said it expects consolidation between independent players in the industry.
