Digital Banking

Are Consumers Warming To Bank Robo-Advice?

A recent Accenture survey of more than 4,000 bank customers in North America shows that consumers are becoming more open to receiving robo-advice for banking services.

What the survey results show is that 46 percent of banking customers are open to computer-generated advice and services for their banking needs. Consumers said they are OK with this option including advice on how to allocate investments (79 percent), the type of bank account to open (74 percent) and tips for retirement planning (69 percent).

“It’s well-known that robo-advice is gaining significant traction in the wealth management industry; however, our research shows this trend is also picking up in retail banking,” said David Edmondson, senior managing director of Accenture’s North America Banking practice. “Consumers will continue to dictate how, when and where they want to interact, and banks have an opportunity to use intelligent automation and robotics to simplify and improve the customer experience. Successful banks will strike the right balance between human and machine interaction to elevate their role in customers’ lives beyond simple transactions and become a go-to resource.”

Consumers cited liking robo-advice for its speed and convenience (50 percent) and lower costs (29 percent).

“Consumers no longer view switching banks as a hassle, which puts pressure on firms to not only attract new customers, but find ways to keep existing customers loyal,” continued Edmondson. “According to our research, 79 percent of consumers consider their relationship with their bank to be purely transactional – this is a missed opportunity for banks that now have access to technology that can help them provide more tailored offerings, particularly as more consumers are open to receiving value-added services from their bank. In fact, 45 percent of consumers said the top reason they would stay loyal to their bank is if it offered discounts on purchases of interest.”

In the survey, one-fourth of consumers in the U.S. said they would consider switching to a bank with no branch locations, up 3 percentage points from last year. But the survey also showed that one-fourth of survey respondents use the branch at least weekly. This remains the second most preferred channel, following online.

But despite many of the consumers (23 percent) saying they experience at least one financial data breach incident in the past two years, consumers are still open to sharing their information in exchange for better service. Nearly two-thirds (63 percent) of respondents are willing to give their banks direct access to personal information, including mortgages, credit cards and student loan data in order to get information about more services.

“Today’s consumers expect their service providers to understand and anticipate their needs and offer a seamless experience across digital and physical channels – and they expect this as much from their bank as they do from retail stores and Internet giants,” Edmondson concluded. “Even as consumers indicate interest in robo-advice and online banking, they continue to demand human interaction at the branch to handle more complex banking needs. Banks need to find ways to blend the digital and branch experiences to provide more value-added services to their clients, and move past their role as a transactional service provider.”

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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