Things have been looking up in many banking markets, with stabilizing economic conditions and record profits reported by numerous banks. However, CGI’s 2017 Global Financial Consumer Survey results reveal the ongoing need for banks to remain vigilant in keeping pace with evolving consumer expectations.
Continuing CGI’s many years of primary research into the views of banking consumers around the world, we again dug deep to explore consumer perspectives on financial technology (FinTech) concepts, including which services consumers value the most and the types of providers they want to use to access those services. With the advent of open banking enabled across the globe by open APIs and pushed by regulators in Europe, we also explored consumers’ views on using third party providers for less flashy, everyday banking activities, such as ordering a new card or answering a basic query.
In 2017, we surveyed 2,250 consumers across the U.S., Canada, the UK, France, Germany, Finland, Sweden, Singapore and Australia to get their perspectives on 10 digital FinTech services, such as marketplace lending, mobile payments and robo-advice.
Perceived value of FinTech services
The 10 digital services analyzed by the survey include the following: protection, personal finance management (PFM), mobile payments, personalized digital experience (both auto- and self-personalization), personalized offers, bartering, alternative currency, marketplace lending (e.g., peer-to-peer) and robo-advice.
The relative ranking of value did not change from last year’s results, with protection leading all demographic groups and countries—not too surprising in light of recent events that only add to consumers' concerns about cyber attacks, identity fraud and other security risks.
Notably, consumer perceived value for these concepts was flat or increasing for all, with no service declining in perceived value and substantial (8-9%) increases in terms of personalization. In aggregate, consumers are increasingly interested in a variety of FinTech concepts.
While last year’s survey, “FinTech Disruption in Financial Services,” had good news for banks with 75% of consumers citing a preference to acquire new digital services from their current financial institution, this year’s survey raises a warning flag in terms of service provider preferences among consumers. Results showed that, while a majority of consumers still prefer to receive new digital services from their current primary financial institution,preference for incumbent banks to deliver FinTech innovation is in decline, down by an average of >8% in just 12 months.
These findings reveal the need for established banks to move rapidly in deploying new services before their advantage evaporates. Those that do not move quickly run the risk of consumers going elsewhere for services they want but can’t get without turning to faster-moving banks or directly to FinTech firms.
For FinTechs, it’s clear that getting access to customers remains a big challenge. While the increasing openness of consumers to go outside the traditional banking industry may give some FinTech leaders renewed hope, the door isn’t exactly wide open for a new wave of additional players to succeed with a “go it alone” strategy.Partnering with banks is still the clearest path for FinTechs to overcome the challenge of gaining awareness and consideration on the path to winning customers for their innovative services.
In our next blog, we’ll share key recommendations for both banks and FinTechs in light of the survey’s findings. In the meantime, download our survey report, “Today’s Financial Consumer: Open for Business,” or contact me with any questions you might have.