Inheritance planning could offer financial services providers in China a significant business opportunity given only half of wealth managers that target high net worth investors offer the product currently, according to data and analytics company, GlobalData.
With a substantial entrepreneur community, 71 per cent of whom are 51 years old or above, a large number of Chinese business owners would need to find successors in the coming years.
Senior wealth management analyst at GlobalData, Heike van den Hoevel, said the lack of a detailed succession plan puts the continuity of an entire business at risk.
“The situation also represents a missed opportunity for wealth managers to build ties with the next generation early on, which is important given the propensity for individuals to change advisors at the time of inheritance,” said Hoevel.
GlobalData estimated that in addition to the 106,500 business owners who had already hit retirement, another 219,500 would retire within the next ten years.
“If providers fail to ensure the continuation of the relationship with successors, this will amount to a significant chunk of their current business being lost.”