6th July 2022 – Consumers today demand a broad range of traditional and modern services from their bank or financial services provider according to new research from next-generation core banking platform, Tuum. The study, carried out by Sapio Research on 4,000 consumers and over 300 IT decision makers in financial services across France, Germany and the UK, found that end users are demanding an increasingly diverse range of financial services. While consumers are keen to adopt innovative new banking services that facilitate and improve their quality of life, there’s still overwhelming demand for traditional banking services such as savings accounts. The findings present banks and established financial service providers with an important opportunity for growth if they’re able to quickly roll out new, in-demand services while maintaining a broad portfolio of traditional financial services.
Since arriving on the financial scene, fintechs have posed a threat to established banks and financial service providers with their laser-focus on certain niches, such as multi-currency accounts and their ability to rapidly roll out innovative services. Fintechs have indeed succeeded in introducing and stimulating demand for new types of banking services. The research found growing demand for convenient banking services that blend in with peoples’ everyday lives and which help them to better manage their money. Such services include quick and easy money transfer and bill splitting services (with almost one in three people using these), integrating accounts into one place (with 18% of people using this feature) and zero fees spending abroad (13% of people using these services).
However, in the current climate of financial uncertainty, the study also highlighted strong consumer demand for traditional banking services. Savings and overdrafts are the most popular banking services across age groups with 65% and 35% of people respectively using these. In addition, the research revealed how consumers still regard banks and established financial service providers as reliable and trustworthy establishments and their preferred providers of new banking services. When quizzed about the types of services consumers would like to see introduced by their bank, almost two out of ten people (16%) said they’d like to see their bank open up access to cryptocurrency markets despite these services already being available through various third party providers.
Commenting on the research findings, Tuum Co-Founder and Chief Business Officer, Rivo Uibo said: “Customers want the best of both worlds – convenient shiny new services and more traditional services, like savings and overdrafts. While banks have felt the pressure of their nimble fintech counterparts for years, these findings show they’re actually still in prime position.”
He continued: “Established players are well placed to deliver both, retaining market share and leveraging the overwhelming trust they still hold with consumers – especially when they’re looking to trial new services. Those that have the technology in place to better understand their customers and quickly roll out the services they need are today in a strong position. Fintechs, the pioneers of banking innovation, still have a lot to gain amid consumer demand for new banking services, but should also consider diversifying or expanding their offerings.”
The study which took place in February this year, also revealed how banks and other financial service providers are broadly in tune with the changing needs of consumers. Further, they are introducing new technologies and undertaking transformation programmes in order to roll out new services more quickly. It found that 64% of banks and financial services companies have already or are currently transforming their technology stack while a further 35% have transformation plans in place which they have yet to commence.
Download our full report: The Changing Face of Banking