Over two-thirds of UK consumers would not share their personal financial data with third-party providers, according to new research from Accenture.
The consultancy firm believes this gives traditional banks the opportunity to benefit from trust they have built with consumers over the years.
Surveying more than 2,000 UK consumers, Accenture Research found that 69% would not share their bank account information with third-party providers.
Open banking legislation, including the Revised Payments Services Directive (PSD2), means that consumers will soon be able to share their financial data securely between banks and third parties, making it easier to transfer funds, compare products and manage their accounts.
But Accenture’s research indicates that many consumers will be uncomfortable doing this. Fifty-three percent of respondents said they will never change their existing banking habits and adopt open banking.
And the survey revealed that 73 percent of consumers would be reluctant to share personal financial information with retailers and 93 percent reluctant to share that information with social media companies.
“Open banking has the potential to transform consumers’ relationship with financial products, but it hinges on consumers’ willingness to embrace it,” said Jeremy Light, managing director at Accenture. “Until new entrants to the financial services sector can earn consumers’ trust, banks can draw on their extensive heritage to secure an important early advantage.”
This survey highlighted fraud as Fraud as the main obstacle to consumers embracing open banking, with 85% claiming increased risk of fraud was the biggest barrier to them sharing bank account information with third-party providers.
“Retailers will also need to communicate clearly with their customers to demonstrate the potential benefits of giving consent to sharing their bank information, whether to receive discounts or gain access to credit,” said Light. “And given consumers’ fear of fraud, strong customer authentication — including two-factor authentications and the use of biometrics — will be important to address both fraud levels and the perception of security among consumers.”
“With UK consumers placing their faith in traditional service providers, banks can capitalise on the opportunities to create new revenue streams and capture new customers, which the era of open banking provides,” said Light. “If banks move too slowly to adapt to this transformed, open banking landscape, they could miss out on the platform-based business models and the strategies they enable. In short, banks will need to up their digital game or risk failing to meet growing consumer demand for a seamless digital experience.”
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