Our survey of 36,000 consumers in 12 markets investigated the impact of COVID-19 on people’s finances and aspirations.
Our survey of 36,000 consumers in 12 markets, conducted between July and October 2020, investigated the impact of COVID-19 on people’s finances and aspirations, as well as the pace at which they are adopting digital technology. This report, Future Money, explores the implications of our survey for financial services in the future.
How will financial services evolve?
A new generation searches for new solutions
The financial needs of young consumers are changing, making them more willing to experiment with innovative banking technology. The majority (79 per cent) of people aged 18-34, particularly in fast-growth markets, see the pandemic as an opportunity to work harder and get ahead in their career. These customers are seeking out diverse income streams and ways to invest. They are confident they have the digital skills to thrive in a post-COVID-19 world and are beginning to experiment with digital financial services and tools. These trends point to the rise of digital solutions such as agile investing, automated switching services for banking and more nomadic banking services.
The shift from physical to digital banking is picking up pace
A branchless and cashless banking world may come earlier than expected as the adoption of digital products and services accelerates.
COVID-19 has prompted more people to bank on their mobile phone, laptop or tablet, with a corresponding drop in in-branch banking – and consumers expect this trend to continue. We are also seeing a faster transition to cashless societies: two thirds of consumers around the world (64 per cent) think their market will stop using cash altogether, predicting on average that this will happen by 2030.
The accelerated switch to digital could trigger a faster expansion of super apps, more experimental banking services and a greater focus on biometric security.
Our approach to spending and managing money is becoming more mindful
While online shopping is growing rapidly, hyper-local, ethical spending is on the rise, and consumers are taking a more careful approach to spending. COVID-19 has made consumers more aware of what and how they buy. Despite a marked shift towards e-commerce – with almost half (48 per cent) of people saying they now prefer to buy online – many say they are more interested than ever in buying goods produced locally and sustainably and spending their money with small businesses.
What are consumers telling us?
The local view
Fast-growing markets are more confident in their outlook, with a greater appetite for experimentation with new ways of earning and more mindful ways of spending.
More confident Respondents in Kenya (89 per cent), India (89 per cent) and UAE (87 per cent) are the most confident in their ability to thrive in a more digital post-COVID-19 world.
More experimental Kenyan (85 per cent), Indonesian (80 per cent) and Pakistani (66 per cent) respondents are the most likely to consider starting a new business to diversify their incomes. More mindful Respondents in Kenya (93 per cent), India (90 per cent) and the UAE (89 per cent) are the most careful with their spending and Indonesians, Kenyans and Indians are most likely to be buying more products from small, local and sustainable businesses as a result of COVID-19.