Consumers cautious of new banking technology

Results from the 7th Annual ING International Survey on attitudes towards financial technology were released this week and revealed that, despite a high demand for banking innovation, consumers are often hesitant when it comes to adopting it.

Out of almost 15,000 people across 14 European countries that took part in the survey, almost 90% actively use multiple mobile devices for their banking needs, but what about other tech services on offer?

While many new financial service providers find their feet on the market offering money management, transfers, spending tracking, lending and more, half of European consumers still stick to their banks only. This shows a certain degree of customer ‘stickiness’ in regards to banking services – whether through cautiousness, loyalty or simply inertia.  

New European legislation on the sharing of financial data is a major development and one that consumers are adopting slowly. The reason being that the benefits of this form of data sharing – like the ability to view financial information from different FIs within a single interface – are simply unknown to a lot of people, with up to 55% of Europeans completely unaware of PSD2 or the Open Banking movement. These numbers vary by country, with the highest share of uninformed consumers living in Luxembourg and France – 67% and 71% respectively. While this may change if financial institutions continue to implement the new service and spread awareness, given the newness of the practice and its ongoing development, the response is not surprising and is likely to change in the future. The results also revealed that there is a correlation between consumer awareness and their willingness to share their information in this way. At one end, Turkish and Romanian consumers aware of the option are more open to using it (54%); and at the other end, less informed Belgian and Dutch consumers remain highly skeptical (62% and 63%).

Another topic the survey covered was fraud, and with various types of fraud on the rise, consumers are understandably cautious when it comes to managing their finances. Two-factor authentication gained the most trust – 70% in Europe, and up to 82% in some countries. Simply entering a password is not enough anymore as passwords are often predictable and easy to hack. Fingerprint identification is understandably gaining momentum, however, not all banks and, more importantly, not all mobile devices, support it.

It takes time for people to get used to new technology. Despite some concerns about security and maintaining control, and the hesitation to use new financial technology, 73% of consumers believe banks should be offering the latest technologies to their customers - they want to have their options open.