Fintech: 3 reasons why you didn’t like online banking
Fintech: Online Banking Adoption Rate
Online banking has seen tremendous growth and success in the Canadian market with an approximate 50% penetration rate. These numbers are constantly climbing and we could expect higher rates every year as the services become more user-friendly.
Online banking awareness is at an all-time high with 96% of people stating that they have at least heard about the services that are provided such as e-transfer, paying bills, depositing cheques and more.
Fintech can act as an extension for the existing physical spaces. For example, you could complete simple, mundane tasks online while using the available in-branch services to make more complex decisions
That being said, with the banking industry still shifting its focus from brick and mortar operations to digital servicing, it’s important to us at Caddle to determine what suggestions you would make to optimize this technology.
We got to hear from you!
Some of you still may be wondering, what is Fintech? It’s a combination of “Finance & Technology”. Fintech includes a variety of different services including:
- Transaction delivery
- Peer to peer lending
- Digital wallets
- Online banking
So how does Caddle fit in? Caddle is a data insights company that has a passion for understanding market trends which can be translated to the market industry leaders for the benefit of understanding the buying behaviors of their consumers.
We took a look at what our members had to say about Fintech. With an average of about 8000 survey respondents approximately 80% of respondents were female, 50% were Millennials, and 40% were from Ontario. We hope that using this sample size we can garner a better understanding of Fintech and help provide the best insights.
Financial technology (Fintech) is used to describe new tech that seeks to improve and automate the delivery and use of financial services.
1) Fintech: Digital Banking Awareness
We conducted a digital bank survey that was focused on determining our member’s awareness and preferences when it comes to conducting their finances online. For this particular survey, we are talking about banks that are solely online with no available storefronts.
We found that more than half of our members were familiar with digital banking. That being said, 54% did not use digital banks and the next best option was Tangerine. All those Toronto Raptors commercials are paying off!
What is interesting is that digital banks have a multitude of advantages that traditional banks don’t. For example, they can offer you higher interest rates and lower banking fees because they have cheaper operating costs than brick and mortar locations.
Fintech: Why not make the switch?
If people are willing to sacrifice earning more money there must be some underlying issues. Banks have invested plenty of money into targeting Millennials and onboarding them to digital platforms.
What is causing people to be so skeptical?
This could be a result of respondents feeling neutral when it comes to their personal info and data being safe with digital banks. Does that mean you heard about the Capital One security breach?
Members simply had no interest when it comes to switching to a digital bank. This could be a result of banks failing to address your concerns:
- Where do I deposit my cash?
- How do I talk to a real person?
- What type of insurance coverage do I get?
2) Fintech: The Banking App Experience
The findings from the banking app experience survey helped us identified that only 34% of members had a “good” experience when conducting transactions online. This includes them logging on a few times a week to check the status of their accounts.
Members were comfortable completing simple transactions such as:
- Transferring money (e-transfer)
- Paying bills
- Checking account balances
Fintech: Online Banking Stops Here
The previous results were anticipated but when asked if members conducted any other activities like communicating with advisors, applying for loans or mortgages, or opening accounts, the majority said they don’t complete any activities.
This is important because it is evident that members are not comfortable making certain decisions using online platforms whether or not it is an issue of privacy, lack of financial guidance, or inaccessibility.
3) Fintech: The New Digital Wallet
How many of you carry cash? Probably not often right? What if I told you now you don’t have to carry your wallet. The future is here, all you have to do is tap your phone to make a purchase! (ie: apple pay)
To be honest, it’s an interesting experience and there are valid points made from each side of the spectrum.
67% of you said that you don’t currently use a digital wallet.
Here are the following reasons why our members are skeptical about making the leap to digital wallets:
- Safety and security. Members disagreed with the following statement, ‘my personal information and money is safe with digital wallets’.
- Over half of the respondents were Millennial’s (1978-1996). A large portion of these members are not digital natives.
- There is a lack of awareness and perceived functionality.
- Digital wallets are a relatively new concept (less than 10 years). This technology is still in the early adoption stage.
- Out of the respondents that did use digital wallets they preferred Apple Pay.
Fintech: Digital Transactions Experience Steady Increase
According to a study completed by Payments Canada, they found that “in 2016, the number of contactless transactions increased significantly, to almost 2.1 billion transactions worth $67.1 billion.
This represents an 81% and a 78% increase over 2015, in both volume and value terms (respectively).”
At Caddle, we feel that the lack of presence and usage of digital wallets lies in the hands of the organizations. There is just simply a lack of education and promotion surrounding the benefits associated with this technology.
Hotspot shield also conducted a survey and found similar results.
“A strikingly small 12 percent had ever used any of the applications at all. Of those who had used the technology, PayPal was the runaway favorite, while second-place Google Wallet had been used by only 8 percent of the survey subjects”.
Consequently, our respondents displayed minimal interest in converting their handheld wallets to be linked to their mobile devices.
What’s that old saying? If it ain’t broke, don’t fix it?
The Saftey Guide
For those of you that are going to be cashing in those Caddle earnings and saving more money by shopping online, we have a safety guide just for you. Get your pen and paper ready. Whether or not you will be browsing Amazon or taking advantage of Cyber Monday/Black Friday, this guide will protect your money!
- Review your bank statements (every month)
- Don’t make purchases on PUBLIC wifi
- Secure your home wifi
- Use two-factor authentication (2 passwords for your banking)
- Change the password for your email/bank after the holidays
- Don’t share your PIN(s) with anyone
- Look for spelling errors or inconsistencies on websites
- Use 3rd party sources (PayPal) to secure your funds
In Canada alone, there were over 1.2 million in compromised funds last holiday shopping season with a total of 1179 victims.
Now that you have got some good tips and tricks we want to hear from you! Check out our daily surveys on the Caddle app and share some of your insights using this link. Whats are some of the holiday gifts that you will be purchasing? Are you going to be shopping online or in-store? We want to hear it first!
Thanks for reading! Follow us on social media and register online to have access to more blogs and surveys.
Jeremy is an Intern Content Creator and Blog Writer for Caddle who is interested in analyzing consumer insights in order to post impactful content that help readers get a competitive edge. When he’s not busy pursuing a BA in Business Communication, you can often find him in the Caddle office rocking a stellar moustache.