UK consumers embrace fintech in face of cost-of-living crisis
Open banking network Plaid has revealed that 84 per cent of UK consumers are using fintech to manage their money in 2022.
The network’s third annual report entitled The Fintech Effect, published today, revealed there has been broad fintech adoption across demographic groups.
The report found persistent mainstream fintech adoption as consumers seek to get a tighter grip on their finances against the backdrop of the cost-of-living crisis.
Plaid found that over the next six months, UK consumers expect to manage 72 per cent of their finances digitally on average, up from 67 per cent today.
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Even those not currently using fintech expect to manage 58 per cent of their finances digitally over the next six months, up from 52 per cent today.
Last year’s research demonstrated that consumers developed new habits because of the Covid-19 pandemic, while this year’s report reveals those habits have endured.
Among the benefits of fintech, 41 per cent said it enables them to understand their spending and better manage their money. More than half (56 per cent) said it saves them time, while 49 per cent reported that it makes them feel more in control of their finances.
Respondents also reported an increase in financial stress, with 62 per cent of consumers saying this had increased since last year, and 83 per cent citing the rising cost of living as their main concern. Some 41 per cent of consumers said they had no confidence in the economy.
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Almost three quarters (74 per cent) of consumers said they needed their bank to connect to the apps and services they want to use, while 48 per cent would like to see their bank partnering with more fintech companies.
UK policy lead at Plaid, Kat Cloud, said the cost-of-living crisis meant the need for fintech solutions is increasing and called for a transition from open banking to open finance.
“Open finance will give the fintech industry the ability to deliver new digital financial use cases that better meet people’s needs, from pension management to better debt management tools,” she said. “Our research proves that consumers have shown an appetite for these tools and so innovation must continue.”
The survey was conducted online within the US by The Harris Poll on behalf of Plaid between 30 June and 14 July 2022. It polled a total of 4,010 adults across the US and UK, aged 18 and older. This data is drawn from the 2,008 UK participants.
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