Nine in ten U.K. consumers surveyed feel uncomfortable with the idea of fintech third parties accessing their financial data.
So says a new study based on a survey of 1,000 consumers from 18-55 who manage their finances online, combined with interviews with a sampling of consumers of varying ages, income levels, and degree of technology use. The study was conducted by Strive Insight, an England-based marketing and research agency.
Entitled, The Future of Fintech: A Consumer Perspective, the study produced four recommendations from:
• Fintech providers need to overcome consumer inertia.
• They must deliver tangible benefits to meet high consumer expectations.
• They must overcome fear of fintech technology and a certain mystery surrounding it.
• They must build trust in their brands, which is currently not widespread.
The research describes a consumer base that is open to new approaches, but not ready to jump in with both feet, or, even, necessarily, more than a toe. Other findings:
• 88% of consumers surveyed agreed that tech improvements will lead to better products, but only 53% currently use their bank’s mobile app.
• More than eight in ten early adopters believe that artificial intelligence will streamline dealings with their current bank. However, among the overall sample, 76% don’t believe advice from AI will ever surpass that from a qualified human.
• Trust in fintech use of data is low and the tradeoff of security for benefit is questioned. Only 19% of the sample strongly agreed with the statement that “I know how tech companies are using my data to improve products and services.” And 90% say they are uncomfortable with the way third parties access their data for that purpose.
All this said, Strive Insights’ study found that traditional banks have their own work cut out for them:
• 69% will consider any new financial product that appears to offer a clear advantage, no matter the source. So there are plenty of potential departures out there.
• 65% agree that banks, rather than fintechs, are most likely to offer high quality financial advice—but 41% of the sample don’t think large banks will still exist two decades from now.
A key conclusion drawn by Strive: “While technology will no doubt disrupt the financial services market, wide adoption of new fintech services and providers is likely to be more gradual. At present, we see a stark contrast between an industry moving at pace and consumers preferring the safety of what they know. Hence, we believe change will happen, but not at the pace anticipated by many.
“The good news is that traditional and new providers are already collaborating and this co-operation will help to build the adoption of fintech services among consumers.”