EY: fintech adoption gathering pace
Doing business online has surged among consumers worldwide — including Bermuda.
And the insurance sector globally has rocketed from being one of least used fintech services in 2015 to the second most popular this year.
Chris Maiato, advisory leader for the Bermuda, Bahama and Cayman region at professional services firm EY, said: “We are seeing widespread fintech interest in the BBC region, across all industries.
“Fintechs not only provide an opportunity to our market, but our market provides an opportunity to fintechs by giving a window into some of the largest companies in the insurance, banking and asset management industries.
“In the BBC, fintechs have direct access to leadership teams and global markets.”
He added: “What we have seen in this market is that industry, the big insurance companies and banks across the region, are investigating fintech on a broader scale and what it means for their industry.”
Maiato said that companies were either setting up their own wings to examine innovation or forging partnerships with existing fintech companies.
Mr Maiato was speaking after EY released its fintech adoption index, which covered 20 markets worldwide and interviewed 22,000 consumers.
He said: “fintech is an opportunity to increase the reinsurance market and allow the players access to larger communities of potential clients.”
And he added: “Access to insurance-related fintech products is increasing. People will buy their products and services through a different digital channel over the coming years.”
Mr Maiato said that Bermuda “was really hard to compare against the larger jurisdictions” in terms of consumer adoption.
He added: “But our user community here is very tech savvy. We also have here a population which travels quite extensively, whether for work or leisure.
“While we don’t have an exact number, I would suspect the adoption of technology overall is very good.”
The survey showed a global surge in use of technology by consumers over the last 18 months — and that technology was poised to be embraced by the mainstream.
The study said 40 per cent of fintech users regularly use on-demand services like food delivery, while 44 per cent participate in the sharing economy — for example, car sharing.
In contrast, only 11 per cent of non-fintech adopters use either of these services on a regular basis.
The survey said that millennials — those aged 25 to 34, followed by 35- to 44-year olds — were most likely to use fintech.
Researchers found these groups were most comfortable with technology and that they required a large range of financial services as they hit milestones like graduation, first full-time job, buying a home and having children.
But the study said that there was growing adoption of technology among older groups, with 22 per cent of digitally active 45- to 64-year-olds and 15 per cent of people aged over 65 regularly using fintech services.
The survey also identified a new category — “superusers” — who use five or more fintech services and accounts and make up 13 per cent of all consumers.
This group said they considered fintech firms to be their primary providers of financial services.
Imran Gulamhuseinwala, EY’s global fintech leader, said: “Fintechs are not only becoming significant players in the financial-services industry, but they are also shaping its future.
“Their new propositions are increasingly attractive to consumers and this trend is only set to continue as awareness grows, concerns are allayed and new advancements are made.
“Traditional firms, who sometimes struggle to deliver the same seamless and personalised user experiences, will undoubtedly need to step up their efforts to remain competitive.
“I think it’s likely we will see greater collaboration between traditional firms and fintechs in the future.”
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