The global financial advisory services market is expected to reach $135.6 billion by 2030, registering a compound annual growth rate (CAGR) of 5.8% from 2023 to 2030, according to a new report by Allied Market Research. The report attributes the market growth to the increasing demand for financial advice and guidance from individuals and businesses across various sectors and regions.
Financial Advisory Services: An Overview
Financial advisory services are professional services that provide financial advice and assistance to clients on various matters such as corporate finance, accounting, tax, transaction, risk management, and others. Financial advisors help clients achieve their financial goals and objectives by offering customized solutions and strategies based on their needs and preferences. Financial advisors may work independently or as part of a firm or organization that offers a range of financial services.
Some of the key benefits of financial advisory services are:
- They help clients make informed and sound financial decisions that suit their risk appetite and return expectations.
- They help clients optimize their financial resources and assets by identifying and exploiting opportunities and minimizing risks and costs.
- They help clients comply with the relevant laws and regulations and avoid legal and tax implications and penalties.
- They help clients enhance their financial performance and efficiency by improving their processes and systems and implementing best practices and standards.
Market Drivers and Restraints
The global financial advisory services market is driven by several factors, such as:
- The rising complexity and volatility of the financial markets and the increasing need for expert guidance and advice to navigate the changing and uncertain economic environment.
- The growing awareness and demand for financial literacy and education among individuals and businesses, especially in emerging and developing regions, where the penetration and adoption of financial services are low.
- The increasing digitalization and innovation in the financial sector and the emergence of new and advanced technologies and tools, such as artificial intelligence, big data, blockchain, cloud computing, and others, that enable financial advisors to offer more efficient and effective services and solutions to their clients.
- The expanding and diversifying client base and the growing need for specialized and tailored financial advisory services that cater to the specific needs and requirements of different segments and sectors, such as high-net-worth individuals, small and medium-sized enterprises, public sector, healthcare, and others.
However, the global financial advisory services market also faces some challenges and restraints, such as:
- The high cost and fee structure of financial advisory services and the lack of transparency and standardization in the pricing and quality of services offered by different providers and platforms.
- The stringent and complex regulatory and compliance framework and the increasing risk of cyberattacks and data breaches that pose threats to the security and privacy of the clients’ financial information and transactions.
- The intense and growing competition and the entry of new and disruptive players and models, such as robo-advisors, fintech startups, and online platforms, that offer low-cost and convenient alternatives to traditional financial advisory services.
Market Segmentation and Regional Analysis
The global financial advisory services market is segmented by type, organization size, industry vertical, and geography.
By type, the market is divided into corporate finance, accounting advisory, tax advisory, transaction services, risk management, and others. Corporate finance is expected to hold the largest market share, as it involves various activities and functions, such as mergers and acquisitions, capital raising, restructuring, valuation, and others, that require specialized and expert financial advice and assistance.
By organization size, the market is bifurcated into large enterprises and small and medium-sized enterprises (SMEs). Large enterprises are expected to dominate the market, as they have more financial resources and assets and face more complex and diverse financial challenges and issues that require professional and comprehensive financial advisory services.
By industry vertical, the market is categorized into banking, financial services, and insurance (BFSI), information technology and telecom, manufacturing, retail and e-commerce, public sector, healthcare, and others. BFSI is expected to account for the major market share, as it is the core and primary sector that deals with various financial products and services and faces various financial risks and regulations that require constant and reliable financial advisory services.
By geography, the market is analyzed across North America, Europe, Asia-Pacific, Middle East and Africa, and South America. North America is expected to lead the market, as it is the most developed and mature region in terms of financial services and infrastructure and has a large and affluent client base that demands high-quality and sophisticated financial advisory services. Asia-Pacific is expected to witness the fastest growth, as it is the most populous and dynamic region with a huge potential and opportunity for financial inclusion and development and has a growing and emerging middle class that seeks financial advice and guidance.
Key Players and Recent Developments
The global financial advisory services market is highly competitive and fragmented, with the presence of various players that offer a wide range of financial advisory services and solutions to their clients. Some of the key players in the market are:
- Bank of America Corporation
- BCG Group
- Goldman Sachs Group Inc.
- JP Morgan Chase & Co.
- Morgan Stanley
- PricewaterhouseCoopers LLP
- Deloitte Touche Tohmatsu Limited
- Ernst & Young Global Limited
- KPMG International Cooperative
- McKinsey & Company
Some of the recent developments in the market are:
- In February 2023, Morgan Stanley Investment Management announced that it had received approval from the China Securities Regulatory Commission (CSRC) to take a full controlling stake in Morgan Stanley Huaxin Funds, marking a key strategic advancement for the company’s broader footprint in China.
- In February 2023, Global management consulting firm Boston Consulting Group hired Axel Weber, the former president of the country’s central bank and UBS chairman, as a senior advisor in Germany, strengthening its expertise and network in the financial sector.
- In January 2023, Goldman Sachs Group Inc. launched a new digital wealth management platform, called Marcus Invest, that offers low-cost and automated investment advice and portfolio management to its clients, expanding its presence and reach in the online financial advisory services market.
