The role of asset servicing is changing. The exchange of emails or documents between investors and fund managers no longer satisfies the security and efficiency requirements of the industry, which has now fully embarked on its digital revolution.
The administrative and financial monitoring of Private Equity funds has become a crucial challenge along its development. However, the evolution of fund structuring, sometimes involving dozens of vehicles within the same fund, requires General Partners (GPs) and Limited Partners (LPs) to equip themselves with integrated and automated tools in a bid to handle this level of complexity, allowing each party to directly monitor the performance and development of the funds and take necessary actions. Institutional investors for example, are requesting fund managers to provide quarterly reports in 30 days, compared to the previous 45 days. Meeting this expectation requires a highly efficient organisation as well as the automation of processes.
The asset servicing partner now plays a pivotal role in providing stakeholders in the Private Equity industry with a fully integrated platform that is fully embedded in the banking ecosystem, incorporating process automation to enhance operational security. It is crucial to have a digital portal that enables client interaction with this platform. This integrated digital tool is designed to prevent workflow disruption and ensure no information is lost between parties. Consequently, this innovative approach offers clients an optimised and secure platform.
Highly sensitive data susceptible to fraud attempts
In an industry of Private Equity that has been lagging behind to adopt digitalisation compared to listed funds such as UCITS, the enhanced platform of the portal intends to facilitate communication between GPs and LPs. It is essential for fund managers to have real-time access to all tools and monitor their fund(s) in a transparent manner. Namely, fund managers are no longer required to exchange by emails or send PDF documents to investors. This shift in practices strengthens the security and automation of operations. Traditional formats have become inadequate and fail to meet current minimum safety requirements. Additionally, highly sensitive data such as banking details contained in the notices exchanged through email, puts investors at risk of fraud if email accounts are hacked.
These integrated tools gain significant benefits from the application of artificial intelligence (AI). Indeed, the institutional investors’ service offer involves the collection and analysis of numerous documents. In this regard, AI facilitates the automation of data processing. By improving the reliability of the whole process, the tool is also better equipped to detect and identify fraud attempts.
As a result, the world of Private Equity has achieved a milestone to address GPs and LPs’ needs. It is no longer simply a matter of delivering information to the players concerned, but also of enabling them to have it available into an operational and secure tool. Today, investors and fund managers may be located anywhere in the world. The implementation of an integrated and automated platform not only ensures the security of all the operations carried out but also grants full access to monitoring data, regardless of the geographical area. It is in this context that we continue to strengthen the functionalities of our CapLink Private platform dedicated to asset managers and institutional investors. Therefore, all players in the Private Equity industry are equipped with an integrated platform and portal to track fund developments in real time and benefit from decision-making tools. Asset servicing now demands a cutting-edge digital platform, that meets the evolving expectations of all industry players.