The clear majority of fintech customers would be happy to use a traditional bank (66%) or insurer (61%) that offered similar propositions and pricing as neobank and insurtech rivals. This is according to a European survey of consumer sentiment, conducted by global management consultancy Oliver Wyman.
With trust in traditional banks and insurers relatively high at 60% on average, there is considerable opportunity for them to win customers back from fintechs. However, there are big differences across the countries surveyed: Germany (71%) and the UK (69%) have the most trust in traditional banks and insurers, followed by France (58%), Spain (56%), and Italy (48%).
Traditional financial institutions – many of which have undertaken significant digitisation efforts in recent years – still serve the majority of retail customers. However, as neobanks continue to make headlines for multi-million customer acquisition levels and insurtechs launch differentiated propositions into the market, the future looks increasingly competitive.
Italians would be the most likely to move back to a traditional bank offering comparable proposition and pricing (80%), while the French (58%) would be least likely to do so. Britons lie close to the average at 65%, followed by Spaniards (62%) and Germans (60%).
In contrast, Spaniards and the French most prefer traditional insurers to neo-insurers when they have the same proposition and pricing (66%), followed by Britons (62%), Germans (56%) and lastly Italians (53%).
Simon Low, Partner and Head of EMEA, Retail and Business Banking, says: “Our survey reveals that traditional banks are well placed to re-capture customers who have switched to neo-providers. By capitalising on high levels of consumer trust, they have the opportunity to gain market share by developing the right digital offering.”
Fady Khayatt, Insurance Partner, adds: “Flexibility, price and speed of obtaining insurance coverage are the main reasons customers consider new digital insurance propositions and our surveys shows that many customers remain underinsured. However, insurtech propositions to date remain relatively niche and traditional insurers are well placed to provide new services to retain and capture customers who are interested in new propositions.”