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Consumers would buy banking and insurance from Google, Amazon or Facebook

Consumers in Europe increasingly consider companies such as Facebook and Google as potential financial services providers

A fifth of European consumers would buy insurance and banking services from technology companies such as Facebook and Google, according to a survey of 7,000 people.

The study, carried out by Fujitsu, also found 37% of respondents would leave their current bank or insurer if they did not offer services through the latest technologies.

Technology is transforming retail banking. The payments sector is the most overt indication of how technology is changing consumer behaviour in banking.

The survey revealed that, while 44% still use cash to make payments, people are trying new methods. It found 32% use mobile payment services, 22% have used wearable devices and 20% have used crypro-currencies, such as Bitcoin.

Francois Fleutiaux, senior vice-president of Europe, the Middle-East, India and Africa at Fujitsu, said customers will use technology when it makes interaction more convenient.

“They may not know where they need it until it is offered, but this is where technology comes to the fore. Technology is the engine that is driving consumer expectations forward, and the financial services sector has to live up to this new pace of change,” said Fleutiaux.

The Fujitsu survey revealed that online banking is the most popular channel across Europe, with three-quarters of people using it at least once a week.

But other channels remain strong, according to the findings. It also found 34% visit their bank branch at least weekly, and 36% use the telephone to speak with their banking provider.

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“While there is no doubt we are moving towards a digital world, this shouldn’t and doesn’t mean that traditional channels are dead,” said Fleutiaux.

“Traditional methods and face-to-face interaction still have a place in modern-day banking and insurance. Successful providers will be the ones that modernise the back office to integrate various channels to create ‘banks and insurers of the future’ that provide customers with all options.”

It is not just convenience that consumers want through digital technology, they also want banks to use the data they collect through digital channels to provide better service levels.

According to the survey, nearly half of consumers want banks to collect and use information about them to offer services; 59% would be happy for their bank or insurer to use their data to lower their mortgage premium; and 44% want their data used to keep them informed of their spending habits.

Separately, Gartner reported that traditional banks will become impatient with traditional legacy IT suppliers unless they can provide the technology required to compete with digitally enabled finance firms and technology companies.

Recent research from Gartner found that 25% of banks will go to startup IT suppliers for their online and mobile requirements by the end of 2019.

Read more on IT suppliers