Industrial and Commercial Bank of China (ICBC) has applied the latest artificial intelligence-led technology to its wealth-management operations, reflecting just how the country’s big banks are now fighting hard to gain an edge over rivals in the sector. Its newly launched “robo-adviser” service will see computer programmes dish out investment advice to retail investors over its mobile banking platform, becoming the first among the nation’s “big-four” state-owned lenders to unlock the potential of the hot new service being adopted rapidly by the industry, worldwide. The value of China’s total robo-adviser services, including those offered by banks, assets managers and fintech companies, is expected to top 5.22 trillion yuan (US$783 billion) by 2020, according to data from consultancy Analysys. Globally, the segment – started in the US – is projected to skyrocket to US$6.5 trillion by 2025, up from US$100 billion last year, according to global consultancy McKinsey. ICBC is the nation’s largest bank by assets, but small- and mid-sized mainland banks including China Merchants Bank, Shanghai Pudong Development Bank, Industrial Bank and Ping An Bank, have already tested the waters in using such robos in a bid to woo the nation’s tech-savvy younger generation and slash costs. “The application of robo-advisers is an inevitable trend in the tech-driven transformation of the banking industry,” said Hu Jie, an affiliated professor at the Shanghai Advanced Institute of Finance at Shanghai Jiao Tong University. “It might take longer for big banks to go through the decision-making processes involved – but once they realise the huge prospects for the segment, they will quickly follow,” said Hu. Big banks in China are still largely playing catch-up in embracing digital technology, where mobile and other tech-driven services are powering retail banking to win more consumers. The strong inroads made by financial technology, or fintech firms, have already nudged banks to move faster in answering growing demand for digital customer services. For retail investors, the investment threshold for ICBC’s new service has been set at 10,000 yuan (US$1,506), a fifth of traditional banking wealth management product limits. Shanghai Pudong Development has the lowest threshold of 1,000 yuan, Industrial Bank and Ping An Bank have set a minimum 5,000 yuan while China Merchants Bank has a threshold of 20,000 yuan. Robo-advisers are considered cheaper options for basic wealth management services, and actually help to trim charges for retail investors, ICBC said on Monday. In its own trial run, the new service – which offered 15 products – offered average annualised investment returns of between 3.14 and 14.59 per cent based on various investors’ risk appetite. The one-year benchmark deposit rate is 1.5 per cent in comparison.