Middle East Families To Experience $1 Trillion Wealth Transfer By 2030 Through Innovative Technologies

The DIFC Innovation Hub, Julius Baer, and Euroclear have unveiled a whitepaper that explores how technology is reshaping wealth transfer. The report, titled "Navigating the Future of Inheritance," focuses on the Middle East, where a significant wealth transition of US$1 trillion (AED3.67 trillion) is anticipated. This shift includes High Net Worth individuals in the UAE, whose assets have grown by 20% since 2022, reaching US$700 billion.

Digital technologies like Artificial Intelligence and Smart Contracts offer promising solutions for asset transfers. These innovations aim to reduce friction and enhance transparency in the inheritance process. Despite these advancements, only 24% of High-Net-Worth Individuals have comprehensive estate plans. This highlights an urgent need for improved inheritance processes.

The report underscores the necessity for collaboration among wealth managers, family offices, regulators, and service providers. Such partnerships are crucial to creating a robust platform for wealth transfer and encouraging adoption of new technologies. Over half of families find it too complex and time-consuming to plan asset allocation across large families.

Mohammad Alblooshi, CEO of DIFC Innovation Hub, stated that the Middle East is at a pivotal point in generational wealth transfer. He emphasized the growing complexity of wealth portfolios due to diverse asset categories and digital investments. The report aims to leverage this moment to drive meaningful change in inheritance practices.

Alireza Valizadeh, CEO of Julius Baer (Middle East) Ltd, highlighted the increasing momentum of generational wealth transfer in the region. He noted Julius Baer's unique position to advise clients due to its family business origins. Valizadeh sees potential in blockchain and tokenisation for secure and transparent wealth transfer processes.

Isabelle Delorme from Euroclear expressed satisfaction with collaborating on this report with DIFC Innovation Hub and Julius Baer. She explained that their goal is to address regional challenges and opportunities within inheritance. Delorme aims to empower financial stakeholders and policymakers to embrace innovation for a future-ready inheritance framework.

The whitepaper serves as a comprehensive guide addressing unique regional challenges while highlighting vast opportunities in inheritance practices. It seeks to empower stakeholders to adopt innovative solutions that promote efficiency and build a sustainable framework benefiting future generations.

With inputs from WAM