UK public not ready for challenger banks as concerns around security halts technology adoption
- The agreement will see Centrica and Fujitsu working together until 2024
- The agreement will enable Centrica employees to work and collaborate across devices and locations on a global scale
- The increase in digital service channels will enable employees to spend more time focusing on the needs of customers
In turn, this reserved attitude could halt technology adoption for financial services institutions who are faced with the fact that more than half (54%) of the British public is worried technology will put their data at risk. A staggering 49% admit these concerns are a key reason they are not planning to adopt more digital banking services in the future.
Despite these concerns, customers still prefer speed over security as over a quarter (26%) prioritise speedier transactions and transfers. This means that the speed at which challenger banks deliver services helps attract and retain customers, as a third (33%) said they enjoy how quickly challengers provide them with information on their finances.
Looking at how Brits bank, access to reliable digital services is also a high priority for almost half (47%) of consumers, however the ability to walk in to a bank branch is still important. In fact, two-thirds (67%) of consumers are more likely to do business with a bank if it has a high street branch. Over the next few years, the majority (63%) of consumers expect technology to play a bigger role in how they pay for things, however the public still prefers the human touch, as 60% would rather deal with a human when resolving issues with a bank.
“Technology has taken banking by storm. The research shows that public trust, above all other reasons, is what’s impacting the financial services sector, and holding back challenger banks from becoming mainstream. Whilst banking with a challenger is now seen as a ‘nice to have’, with more people enjoying the speed and convenience of digital banking, challenger banks need to find a way to convince people that they are trustworthy enough to handle their monthly incomes and other major financial transactions. What we are finding is that many customers still want the security of a physical branch, and although speed is important, human interaction has not yet been replaced by the convenience of technology,” says Ketan Parekh, Head of Financial and Insurance Services, Fujitsu.
The financial services landscape in the UK is also marked by a generational divide in attitudes towards digital banking: half (50%) of 25-34-year olds are excited about mobile banking compared with only 20% of those over the age of 55. Despite this divide, the potential of technology to change they way people bank is an exciting prospect for over a third (37%) of consumers. Technology adoption has also the power to attract or deter customers from banking with certain organisations. For instance, the public is more likely to bank with a provider who is using 5G (42%) and near-field communication (44%), whilst cryptocurrencies (30%) and Artificial Intelligence (30%) would make them less likely to open a bank account with the organisation. The implementation of biometrics divided the public the most, as 46% of customers said the technology would make them more likely to use a bank while 24% said it would make them less likely to.
“These contrasting opinions towards banking and banking habits elevate the need for banks to balance their call to innovate and ability to cater towards various needs and expectations,” continued Parekh. “Digital banking cannot be implemented overnight and it will take longer for some customers to make the best use of it, while some may always want to the security of a physical bank. Ultimately, the desire for branch banking highlights an advantage that the traditional institutions have over challenger banks, as they are able to cater to the needs of everyone.”
“While bank branches still have a place in the financial lives of Brits, there is certainly an appetite among consumers for technology and enhanced experiences. But for banks to be confident in adopting technology that will benefit their customers, they should be honest and ethical in their operations. Ultimately, to innovate, both traditional and challenger banks need the blessing of the public, and this is what unites them. To be successful, traditional and challenger banks need to educate the public about the benefits of new technologies in financial services, and build a relationship based on trust.”
Notes to editors
1Fujitsu’s “From Demanding to Discerning: Techology and the New Banking Customer” report is available for download here: https://www.fujitsu.com/emeia/microsite/new-banking-customer-emeia/
This survey of 8,574 consumers in the UK, Germany, Spain, the Nordics and the Republic of Ireland was conducted by Censuswide in August 2019. 2,041 consumers were based in the UK.
Fujitsu is the leading Japanese information and communication technology (ICT) company, offering a full range of technology products, solutions, and services. Approximately 132,000 Fujitsu people support customers in more than 100 countries. We use our experience and the power of ICT to shape the future of society with our customers. Fujitsu Limited (TSE: 6702) reported consolidated revenues of 4.0 trillion yen (US $36 billion) for the fiscal year ended March 31, 2019. For more information, please see www.fujitsu.com.
About Fujitsu UK and Ireland
Fujitsu UK & Ireland employs over 9,000 people. We promote a Human Centric Intelligent Society, in which innovation is driven by the integration of people, information and infrastructure. We are committed to Digital Co-creation, blending business expertise with digital technology and creating new value with ecosystem partners and customers. We enable our customers to digitally transform with connected technology services, focused on Artificial Intelligence, the Internet of Things, and Cloud - all underpinned by Security. Our customers cover both the public and private sectors, including retail, financial services, transport, manufacturing, government and defence. For more information please see http://uk.fujitsu.com
Date: 20 November, 2019