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Canadians' financial lives increasingly driven by tech

Across the world more and more people are using mobile banking services and nowhere more so than in Africa. Seven out of ten Africans have access to a mobile network and the surge in mobile banking has had a big impact on the continent’s economic growth. “This century will see major changes in the financial habits of Africans and mobile banking will be on of the drivers,” says Charles Kie, Group Executive of corporate and investment bank, Ecobank. “This is an important element in this time of financial inclusion for African populations, and naturally, this is a significant improvement in the level of people’s financial awareness. I’m pleased this innovation started in Africa, because for a long time we had this perception that not much could come out of this continent.” The prospect of convergence between banking and communication services offers Africans the opportunity to access financial services and to adapt their financial affairs which, in the past, tended to be conducted on a cash only basis. The new trend, based on using mobile phone or tablets for transactions, should foster financial inclusion across the entire continent, according to Freddy Tchala CEO of MTN Congo: “Eighty percent of African economies, at least in sub-Saharan Africa, involve a kind of informal economy.” “If we want to regulate this economy, we have to bring them into a set of transactions that are more easily regulated. So, banking will be done through mobiles. 80% of Africans discover new technologies through the mobile and also discover banking through the mobile.”

A study released this week by Microsoft Advertising confirms what many have already suspected: Canadians see technology as something of a double-edged sword as they increasingly use online services and mobile devices to manage their finances.

The technology company surveyed 2,000 people online, and the resulting study, dubbed The Financial Lives of Canadians, suggests consumers have passed a tipping point in terms of their routine use of online tools. Fully 79 per cent of Canadians now use online banking at least monthly, with 60 per cent saying they do so at least once per week.

The satisfaction gap

Not all of them are happy with the experience, however. Although two-thirds of respondents agreed it’s important to have a positive experience on a banking website, less than half reported being satisfied with what Canadian banks are currently delivering.

Less than half of Canadians - 44 per cent - say they enter a bank branch at least once per month. That’s more than those who use mobile apps (27 per cent) and mobile browsers (23 per cent) to manage their banking, but less than the two-thirds of Canadians who use ATMs at least monthly.

Only half of Canadians surveyed reported having more than a basic knowledge of the “mobile banking” term.

Banks aren’t helping their cause, with mobile tools and services that fail to deliver the goods. In a statement, Sep Seyedi, CEO of Plastic Mobile, said mobile maturity has a long way to go.

“The user experience of banking apps in general is quite limited and basic today, just providing the core banking features,” Seyedi said. “In the next couple of years, we are going to see huge transformations in the functionality and the user experience of these banking apps.”

Customize and control

As banks find themselves on the hook for delivering increasingly sophisticated online and mobile services to ever more independent-functioning consumers, their opportunity for redemption lies in customizing the experience for an increasingly disconnected audience, and in giving them greater control over what information is collected and where it ultimately ends up.

Over three-quarters of Canadians report sharing basic data - such as name, address, date of birth, and phone number - with their banks. Two-thirds share their email address, and almost half share data on income.

Canadians are looking to the banks to leverage all that information through creative use of technology to drive greater financial opportunity for them, but they often feel let down, with many reporting a disconnect between the information they share with their banks and the value they receive in return. For example, 79 per cent said they understand the benefits of providing personal information to their banks, but only 37 per cent said they’re satisfied. Similarly, only 38 per cent are satisfied they can see all the data that’s being collected, and 39 per cent are satisfied that they have access to their personal information.

The consistent disconnects between what Canadians expect from their banks when collecting and managing personal data and how satisfied they are with the results suggests the financial institutions are nowhere near where they need to be when it comes to meeting rising consumer expectations.

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