The EY Global FinTech Adoption Index 2019 noted that Australia now sits slightly below the global average for consumer adoption of 64%.
Australia’s adoption rate is up from 37% in 2017.
Globally, fintech adoption by SMEs stands at 25 percent, with China leading at 61 percent, followed by the United States at 23 percent.
Meredith Angwin, fintech advisor at Errnst & Young Australia, said Australia had fallen below the global average despite starting higher than many other Asian markets.
“While our legacy financial institutions have begun to embrace fintech, their current offerings in this area lag behind what we see in some other markets, which has likely impacted our overall ranking,” said Mrs. Angwin.
“However, we expect this to change as more challenger fintechs continue to enter the local market and major players scale up their innovation programs in order to remain competitive and meet the demand. evolving consumer demands.”
The index is based on an online survey of 27,000 digitally active consumers across 27 countries, as well as a survey of 1,000 SMEs using fintech services in China, the United States, in the United Kingdom, South Africa and Mexico.
EY said user adoption has doubled in the Asia-Pacific region and, in some cases, even tripled in key markets in two years, with Hong Kong, Singapore and South Korea all now at 67 %.
China and India have been cited as having the highest consumer adoption rate of fintech in the world at 87%.
According to EY, customer expectations have evolved, driving disruption and innovation in the financial services sector.
“Traditional banks, insurers and wealth managers are disrupting their own propositions by offering digitally accessible and cutting-edge services,” EY noted.
Notably, 68 percent of respondents said they would consider using non-financial services companies for financial products rather than financial service providers.
The survey found that 37 percent of consumers preferred non-financial services companies for short-term peer-to-peer or online loans as investments.
The same 37 percent also prefer non-financial companies for online investment advice and investment management.
The study showed that among consumers’ priorities, price comes first for the majority, with 27 percent of customers choosing it, followed by 20 percent choosing ease of opening an account when selecting a fintech service.
The index also found that globally, an average of 89 percent of consumers are aware of in-store mobile payment and 82 percent are aware of peer-to-peer payment systems and money transfers. non-bank money.
James Lloyd, head of fintech and payments at EY Asia Pacific, said most Asian markets benefit from a powerful fintech feedback loop, with increased adoption leading to increased innovation and vice versa.
“As mainland China continues to play a leading role in innovation in consumer and SME-focused financial services, inspiration from Chinese fintechs is increasingly permeating the region,” he said. he commented.
“This influence can be seen in the response of incumbent institutions seeking to develop their own fintech-inspired propositions, as well as increased regulatory support for non-traditional challenger players in banking, insurance and management. of heritage.”
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