Advances in financial technology and the latest developments in mobile and open banking are increasing demand, as it becomes ever easier to manage your finances using multiple devices.
However, there are conflicting views among the British public when it comes to the expectation for their banks to roll out the latest technologies vs their adoption, according to ING’s latest research on ‘new technologies.’
This may stem, in part, from a lack of trust in technology and concerns over how we interact with these financial tools securely.
Despite an increased availability of mobile banking technology, many Brits still consider themselves users of more traditional means of banking, with 70% of consumers that we surveyed still physically going into their branch to bank.
A report released on 13 May by the Parliamentary Treasury Select Committee, calls for banks to provide their customers with greater access to financial services. Banking technology plays a major role in providing consumers with the tools they need to make accessing their finances easier.
But, one potential stumbling block, if greater accessibility is to be encouraged, is our natural hesitance to use this technology. Familiarity plays a key role in our financial behaviour.
When we are dealing with technologies that are less familiar, in some cases, there is a reluctance to adopt at first. It is clear that Brits are enthusiastic about tech but equally, don’t want to be pushed too far, too soon.
Some Brits are in the dark when it comes to awareness of financial data sharing innovations. In fact, just over half (52%) of Brits have not heard that it is possible for financial institutions to share their financial information, if their permission is given (so-called Open Banking).
64% of Brits say they would not be happy for their information to be shared in this way, and only 23% say it would be useful. In order to boost uptake a better understanding of what options are available is needed.
If these technologies are to be widely utilised by the public, then more needs to be done to alert them to the benefits of such developments.
As well as a lack of familiarity, concerns about security, privacy and maintaining control of finances appear to be key barriers. This is evident in the Treasury Committee’s report, which highlights the “obvious concerns about the privacy of consumer data."
The committee’s report highlights that being in control of one’s finances aids independence and confidence. The key driving factor is trust. Old habits die hard and a trusting relationship with your bank is imperative in financial confidence among many Brits.
In our survey, we found that 62% of people in the UK aren’t comfortable with a computer programme making investment decisions on their behalf and 41% say no to receiving recommended improvements to their spending habits from robo-advisers.
However, seven in 10 (69%) of people believe that banks should deliver the latest technology to their customers, indicating that they want options available to them to adopt in their own time.
Over time, if new digital approaches are shown to be reliable, useful and socially accepted, we could see an increase in the uptake of new technological services.
A clear message is being sent from the British public for their financial services provider to equip them with the latest technologies and make these available to them to adopt in their own time.
Jessica Exton is a behavioural scientist at ING