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Australians grow wary of banks, but will still give them their data

Women use mobile application software on smartphone phone

close up holding smartphone Image: Getty Images

One-third of consumers have reported a loss of trust in banks in the last 12 months.

A new global study from Accenture has found that nearly 6 in 10 consumers would share their personal information with banks despite a third of them reporting they had lost trust in the banks in the last 12 months. Accenture surveyed over 28,000 consumers in 28 markets around the world for the Financial Services Consumer Study, with respondents from Australia saying they would be willing to share location data and lifestyle information with both banks and insurers in exchange for lower prices on products and services.

The results of the survey are timely, with Australia's open banking framework due to start on 1 July 2019. From that date, the Big Four banks will need to start sharing credit card, debit card, deposit account and transaction account data and have all data available no later than February 2020. Under the new framework, people will be able to direct their bank to securely share their data with third parties in order to benefit from services they want, such as finding better products, switching accounts, comparing products, personalisation and more.

Accenture's banking lead for Australia and New Zealand Alex Trott believes open banking will provide a safe way for consumers to share their data despite their reduced level of trust in banks.

"There is no doubt that a reduction in trust overall with banks will reduce a customer's appetite for new services or products, especially from their incumbent provider," Trott said.

"However, open banking should provide a safe mechanism for a customer to choose to share their data with another provider, where they feel they will get a better service. So as long as there is trust in the open banking sharing mechanism, this should improve the overall picture."

And it's not only discounts consumers would be willing to share their data for. Accenture's survey found 76% of respondents would be willing to share data regarding their income, location and lifestyle habits for quicker loan approval while 70% of respondents would share their data for personalised offers based on their location.

Trott cited supermarket reward programs as an example of this data exchange, with store programs tracking what you buy and providing relevant offers.

"Banks will need to ensure that they use customer data wisely and provide a service in the way that the customer feels as if that information is being used – from pre-filling forms through to good investment advice," he said.

However, despite Australians willingness to share their data in exchange for benefits from providers, the survey also found a preference for in-person service. According to the research, 14% of Australian consumers surveyed visited a bank branch at least once per week and 62% of Australians have a positive experience when visiting a branch, higher than the 57% global average.

Interestingly, 59% of respondents favoured face-to-face interactions with their bank and 56% would like their bank to blend physical and digital services. However, 56% of respondents still check their bank accounts at least once per week on their smartphones or tablet devices.

According to Trott, the better digital services become, the lower the number of transactions will take place in physical branches. However, because technology has made certain transactions, such as checking your bank balance, much easier, the total number of transactions has gone up.

"The challenge is for the simple digital transactions to be replicated in branches to be quick for customers and less costly to service and for branch interactions to be those that require more discussion and advice or recommendations," said Trott.

"Adapting a bank's branch network to embrace the digital technologies, but to offer this blended with the engaging human interactions is key. Especially in rebuilding trust."

You can read the full report here.

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