Cost of living crisis pushes consumers to go digital
Britons are changing how they interact with their personal finances and the UK’s banks due to the cost-of-living crisis, according to a new independent survey of 2,000 UK adults. The survey, conducted by Chetwood Financial, found:
- Over half (54%) are finding it difficult to save money due to the high cost-of-living
- Just 32% believe their bank is providing adequate support to manage their finances
- Only 44% have visited their bank branch in person within the last 12 months
- 56% of fintech users have opened a new bank account or product entirely online this year, without consulting a bank or provider
- 70% said they have been checking their online banking apps more often over the last 12 months because of the current economy
Digital-only bank Chetwood commissioned an independent survey of over 2,000 UK adults to determine how the current high inflation and low growth economic environment is affecting their financial behaviours. Unsurprisingly, it found that over half (54%) find it challenging to save money due to the high cost of living.
An additional 31% of those surveyed feel overwhelmed when budgeting and assessing their personal finances, although this figure rises sharply to 52% amongst those aged 18-34.
Overall, 41% have dipped into their savings to help make ends meet. However, just 32% believe their bank is providing enough support to help them manage their finances.
Despite the strain on their personal finances, only 44% have visited their bank branch in person within the last 12 months.
Of the 544 respondents who said they use fintech to help them manage their finances, more than half (56%) said they have opened a new bank account or taken out a new financial product entirely online within the same 12-month period, without speaking to or visiting a bank or provider.
When asked about how they choose their banking providers, 55% said they base their decision on rates and incentives compared to other providers, while 43% choose their banks based on the quality and variety of their technology.
To manage concerns about the high cost of living, 70% of the 544 fintech users surveyed said they have been checking their online and/or mobile banking apps more frequently within the last 12 months. 56% of the same group said they are satisfied with how money management applications have helped them cut down their spending throughout the year.
Andy Mielczarek, CEO of Chetwood Financial, said: “With inflation still sitting close to 40-year highs and energy costs rising sharply in the UK, Britons are facing some of the most difficult financial circumstances in years. In response to these challenges, many are embracing the digital revolution, seeking new methods to bolster their financial management and spending power. The resulting change in consumer behaviour has been palpable.
“Our research suggests that consumers are generally dissatisfied with the level of support from established banks and their existing providers. In many cases, they are seeking newer alternatives that offer competitive rates, cash incentives, and better technology. With more and more bank branches shutting their doors each year, the smaller, tech-first brands are impressing most of all. Often, these brands are better equipped than high street banks to provide tailored guidance, smart solutions, and product innovations that help make their customers better off.”