Financial intermediaries fulfil the essential role of facilitating greater capital mobility and serve as a “middleman” between savings and investment channels. In an ideal scenario, effective intermediation in the capital markets should foster an innovative and diverse intermediation environment to expand supply of assets to meet the growing needs of investors.
Trends such as changing investor demographics and preferences, tighter monetary policy requirements, increasing interest and demand for digitalisation, and issues in the supply of talent in the capital markets can affect intermediaries in varying ways. As the industry moves forward, some intermediaries may choose to tackle these challenges head on to meet their overall objectives.
The goal of fostering effective financial intermediation can come in different forms, and there are many facets to this issue as changes progress. As shown through ICMR’s research, traditional players will need to evolve to meet the needs of the future while also competing with the growth of digitalisation – and how these players choose to do so will be crucial to their survival.