Over half of Australians use fintech, but globally it’s much higher
Australia slipped to position 20 in EY's FinTech Adoption Index.
Three-quarters of consumers globally use a money transfer and payments fintech service and 96% of global consumers are aware of at least one fintech service. This is according to EY's latest FinTech Adoption Index which measures the adoption and awareness of fintech services across global markets.
In Australia, fintech adoption is at 58%, an increase from 37% in 2017. But this increase has not kept pace with other global markets. In 2017 Australia ranked fifth for fintech adoption but this year ranked 20th, beaten by markets such as Ireland (71%), Peru (75%), Russia (75%) and China (87%). The global average for fintech adoption was 64%.
To gauge fintech adoption and awareness for the index, EY conducted online interviews with over 27,000 consumers in 27 markets across six continents. A "fintech adopter" is someone who has used two or more "buckets" of services, a bucket consisting of a major fintech service or two or more related services.
Of the global consumers that had been identified as adopters, 68% would consider a non-financial services company for financial services and 46% are willing to share bank data with other organisations. The top reason for consumers to use a fintech challenger was attractive fees and rates.
EY's report found that the global rate of fintech adoption has grown faster than anticipated.
"The actual global adoption rate of 64% in 2019 exceeds by 12 points the 52% future adoption rate predicted by our 2017 survey," EY said in its report.
According to EY, emerging markets such as China, India, Russia and South Africa are leading the way. While others that also made the top 20, such as the Netherlands, the UK and Ireland, are reflective of the development of open banking in Europe.
The strong growth in fintech adoption has been due to incumbents offering their own fintech products, according to EY.
"Markets with a sharp rise in adoption from 2017 to 2019, such as Ireland, the Netherlands and Singapore, reflect the availability of fintech services offered by banks, insurers, stockbrokers and other incumbent financial institutions."
EY also said in its report that fintech is an industry that has evolved beyond its early stages to "significantly move the dial" on customer expectations.
"Clearly, fintech has caught on around the world, entering the mainstream in all markets studied."