Half of banking customers worldwide are using the services of at least one fintech firm, although trust remains a major impediment to the largescale adoption of these services, according to a report jointly published by Capgemini, LinkedIn, and Efma.
The first World FinTech Report (WFTR) revealed that the adoption of fintech was led by emerging markets. Over 75% of customers in China and India were found to be using fintech services, followed by the UAE and Hong Kong.
The study further unveiled that fintech has made the greatest inroads in investment management, with 17.4% of customers solely depending on these services and 27.4% adopting them alongside their traditional providers.
Sixty percent of financial services institutions said that they want to partner with fintechs, while 59.2% are keen on developing their own in-house capabilities.
Executives are also exploring investment in fintech (38%), partnering with educational institutions (34.3%), launching accelerators (29.6%), and acquiring fintechs (18.6%), the study added.
However, only 34.7% of traditional financial institutions said that they have a well-structured innovation strategy, while 40.3% suggested otherwise.
Also, overall customer trust levels in the fintech providers was found to be low, with 23.6% of customers citing that they trust these providers as against 36.6% who trusted traditional providers.
LinkedIn vice president of marketing solutions Penry Price said: “Rising customer expectations for more personalized and advanced digital experiences, advancements in technology, greater access to venture capital, and lower barriers to entry have created fertile ground for growing FinTechs.
“FinTechs are largely gaining momentum by meeting needs traditional players have yet to address, but many FinTechs lack the transparency required to earn the trust of their consumer audiences to capitalize on these opportunities.”