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Asset Servicers are unsung heroes. Operating across multiple borders, time zones, and regulatory regimes to ensure the smooth running of the fund industry, they have their work cut out for them. Especially in Luxembourg, the world’s #2 fund center. So, what’s on their strategic agenda to ensure they stay relevant?
As an expert, it is crucial for you to know the trends shaping asset servicers in the coming months. From tech disruption to regulatory shake-ups, Luxembourg’s asset servicers must lead the change, not chase it.”
Brice Lecoustey
EY Luxembourg Consulting Partner and Asset Servicing Leader
1. Globalization 2.0: scale, speed, and seamless cross-border operations
Global investors are diversifying rapidly, and Luxembourg’s fund structures are expanding to meet demand. Asset servicers must adapt to support their customer base of asset managers. It bears no repeating, but with EUR 5,950 billion in assets under management (August, 2025), Luxembourg’s asset servicers are under pressure to scale, digitize, and deliver excellence across borders.
2. Private markets & retailization: the rise of semi-liquid structures
Retail investors are entering the private assets space, driving the uptick of semi-liquid funds like ELTIF 2.0. Servicers must adapt to retail-grade standards, integrating liquid and non-liquid operating systems, handling higher transaction volumes, frequent NAV strikes, and intuitive onboarding. Expertise in illiquid asset servicing and valuation is a must have.
The rise of semi-liquid structures demands operational agility and deep expertise in illiquid and liquid asset servicing.
Norman Finster
EY Luxembourg Consulting Partner, Alternative Investments Leader
3. Compliance expansion: DORA and AIFMD II rewrite the rulebook
Two of the most topical pieces of regulation for asset servicers – the Digital Operational Resilience Act (DORA) and AIFMD II – are reshaping governance, risk, and transparency requirements. DORA mandates robust ICT risk management and incident reporting. AIFMD II tightens delegation rules and liquidity oversight while expanding asset manager services. Asset servicers must step up to meet these compliance priorities.
4. Emerging technologies: tokenization and AI
Digital transformation these days dictates longevity. As asset managers embrace AI, analytics, and real-time data platforms, servicers too must keep up or risk becoming bottlenecks. Unfortunately, while asset servicers are investing in digitalization, manual processes and lack of standardization remain major hurdles. This is why there is a huge push for asset servicers to utilize any incentives at their disposal to ramp up transformation, like the tax credit of 18% for investments in digital projects.
Technology is the backbone of tomorrow’s asset servicing. Embracing AI and tokenization isn’t optional, and if in doubt, turn to the experts.
Ajay Bali
EY Luxembourg Technology Consulting Leader
5. Client experience
EY’s 2024 customer experience study uncovered a stark reality: many asset managers are ambivalent about their servicers. Poor service, weak digital capabilities, and lack of transparency are driving churn. Servicers must shift from cost-cutting to client-centricity. Those who invest in CX will retain clients, win new mandates, and grow sustainably.
The bottom line: trendy means transformative
In 2025, being trendy as an asset servicer means embracing transformation. Luxembourg’s asset servicing community is the underlying support system of investment funds in Luxembourg, and due to Luxembourg’s number two status, asset servicers in Luxembourg are essential for the success of the fund industry across the globe. Can asset servicers afford not to embrace these trends? We think not.
Summary
Asset Servicers are unsung heroes. Operating across multiple borders, time zones, and regulatory regimes to ensure the smooth running of the fund industry, they have their work cut out for them. Especially in Luxembourg, the world’s #2 fund center. So, what’s on their strategic agenda to ensure they stay relevant?