Banks still beat fintech firms on trust
Australia’s big banks have some breathing room compared to global markets when it comes to financial technology competitors but more needs to be done, according to a new report into world banking trends.
Australia is slightly behind when it comes to picking up financial tech products, but those using them are far more likely to recommend them to friends, according to a 2016 World Retail Banking Report.
The report suggested real strength could be found in collaborations between tech firms and banks.
“Where they (banks) were strong in some areas, fintechs were strong in others and there was a real opportunity to partner,” Sharon Rode of consultancy firm Capgemeni told AAP.
Customers trust banks substantially more than newer tech services but ease of use has driven nearly two thirds of Australians to tech products.
“The large customer base that the banks come with and where the fintech’s can add value is helping them know their customer a bit better,” Ms Rode said.
Although banks were embracing technology companies overall, Ms Rode said many executives were aware they needed to step up.
“The inability of banks to innovate leaves the door wide open for fintech providers to attract new customers,” Ms Rode said.
The research included interviews with banks and three large Australian financial technology companies Moula, Moneyplace and Banjo.
Moneyplace cuts banks out of the lending process, enabling peer to peer lending online, while both Banjo and Moula specialise in simplifying business loans online.
The way forward for the banks is to collaborate with tech firms, but they need to act swiftly to avoid being outpaced in the market, Ms Rode said.
FINTECH AND BANKS IN AUSTRALIA
* 51 per cent of people trust banks
* 24 per cent trust financial technology firms
* 63 per cent use fintech products
* 96 per cent of banking executives say financial services are moving into a digital future
* But only 13 per cent say they have a system in place to support it
