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Non-bankable assets -
investing in a new era

The non-bankable asset investment opportunity and its challenges

 

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About this report

Non-bankable assets (nBAs), such as real estate, private equity, classic cars or any other rare collectibles, are often managed separately from financial assets, such as shares or bonds. Investing in nBAs, accounting for almost one third of global private wealth, often comes with high entry barriers for investors while providing significant investment opportunities. 

Before non-bankable assets find their way into wealth management at scale, there are some challenges to overcome. The first has to do with valuing nBAs and their potential risk and return for seamless inclusion in a traditional portfolio. The second is around making nBAs accessible and creating liquid markets. And, lastly, the decision for a newly formed business model - the investing in tokenized nBAs -  has to be taken and a platform on which to run it must be developed.

 

How to bank the
non-bankable

 

The right technology foundation in place ensures a seamless experience for investors when investing in nBAs alongside traditional assets. Together with an access to liquid markets for non-bankable assets, these key factors enable wealth managers to push the boundaries of their advisory services.

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"Tokenizing non-bankable assets provides a unique opportunity for financial institutions and wealth managers to expand their AuM and advice offering.

Nils Bulling
Dr. Nils Bulling Head of Digital Strategy & Innovation
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Tokenization is a key technology for scaling non-bankable asset investing. It connects the physical economy with the blockchain to create digital assets. 

3 steps to begin the non-bankable asset journey

1. Setting up the foundations

What it takes to prepare a wealth management platform to include cryptocurrencies and tokenized assets

2. Enabling non-bankable asset token issuing

Why a token issuance platform and access to a secondary market are crucial factors

3. Issuing and distribution tokens to investors

How a wealth manager or FI can develop tokenization business models along their existing strengths and expertise

"New evolving technologies will help to make the non-bankable asset market accessible to new client segments. This includes blockchain technology, which enables the tokenization of nBAs and helps to create liquid markets for those assets."

Philippe Meyer
Philippe Meyer Head of Blockchain Solutions at Avaloq

How to build a non-bankable asset growth strategy

Non-bankable assets provide a unique opportunity for financial institutions and wealth managers to expand their assets under management and advice offering. The strategy promises an increase in asset volume with reduced client acquisition costs, given that it can leverage an existing client base.
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