CGI released a new report, “Today’s Financial Consumer: Open for Business,” covering the results of its 2017 Global Financial Consumer Survey. Now in its fourth year, the survey assesses and provides insights into how consumers view their primary financial service providers, along with what consumers want and expect from their providers in the future. This year’s survey includes the views of 2,250 respondents across 9 countries.
Overall, the survey’s findings show an increasing willingness among consumers to move to financial service providers that offer more value-add services, such as advice, rewards and personal finance management. The findings highlight the urgency for traditional banks to accelerate their service and innovation agendas to retain and grow profitable customer relationships in the face of increasing competition from nimble and innovative bank and non-bank competitors. Incumbent banks have an opportunity to accelerate innovation through partnerships with third-party providers, including FinTechs, as well as established technology firms, to take full advantage of new opportunities and rising consumer expectations.
Security remains a top concern for consumers, creating a competitive advantage for banks that invest in greater protection capabilities, as well as in building a reputation for security. Further, the survey confirms the growing opportunity for banks to provide a holistic channel strategy that brings together digital and personal services.
Consumers remain interested in receiving new, innovative digital services, ranging from 33% who perceive value in robo-advice to 80% who are interested in services that enhance protection from fraud and identity theft. However, provider preference is shifting among consumers. While a majority of consumers still prefer to receive new services from their current primary bank, in just 12 months, there has been up to a 15% decline in the number of consumers who prefer to receive new services from traditional bank providers. More strikingly, the survey confirms that over half of respondents are open to using third-party service providers for everyday banking services such as “looking for advice on financial products” or “resolving a fraud or security issue.”
Consumers continue to put a great deal of trust in traditional retail banks, with 61% holding them ultimately accountable for moving, storing and protecting their money. However, traditional banks face challenges as the banking marketplace becomes more open to new competitors, enabling non-bank financial providers to compete directly with incumbents. Incumbent banks face the challenge of protecting their margins from non-bank competition that operate with new business models, while bearing the costs of maintaining their traditional banking infrastructure. Further, survey findings indicate that consumers continue to hold traditional banks responsible for anything that goes wrong, even when they are using a third-party service provider.
Other key survey findings include:
- 73% of consumers are open to using a single bank account for all payments linked with a mobile app without having the option of using alternative accounts
- 40% of consumers don’t mind where their money is stored as long as they have access
- 43% of consumers would rather have a single mobile payments service across accounts rather than one per account
Two out of three consumers feel they have lost a personal connection with their bank, yet two out of three consumers also feel long-term relationships with their banking partner is important. This dichotomy creates a significant opportunity for banks that are ready to pursue customer-centric strategies—strategies that combine relevant and personalized digital services with personal services through both in-person (branch) and remote channels (phone, video, and chat). The opportunity and urgency to respond is especially pressing given that more than half of consumers are willing to switch to new providers for value-add services.
“With the advent of open banking fast approaching, leading banks are leveraging their strengths in terms of customer access and trust while pushing into new innovative services through partnerships with third-party providers, including both FinTech startups and established technology firms,” said CGI’s Kevin Poe, Vice-President, Global Retail Banking. “Banks are increasingly relying on CGI to help them prepare for a digital-first future. Through partnership, innovation, and service excellence, CGI transforms legacy technologies and operations and supports bank in embracing the exciting opportunities that are revealed as they move towards truly customer centric strategies.”