Cost of living crisis
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UK Banks Are Failing To Respond to the Cost of Living Crisis Correctly; Finds CRIF Research

Consumers across the UK are turning to their banks for financial assistance amid the crushing cost of living crisis; new CRIF research finds. 

The report published by CRIF surveyed consumers in countries across the continent including France, the Czech Republic, Italy, Germany, Slovakia and the UK, to better gauge general attitudes towards financial services and how providers can better mitigate the rising cost of living.

The results from the UK specifically pointed to a consensus that banks should be doing more to help their customers at a time when budgets are being stretched to their limit.

While the majority of people in the UK plan to cut back on both essential and non-essential spending, just under one in five people still plan to borrow more in the next 12 months to help them manage the rising cost of living. This figure represents the highest recorded in Europe.

Although 64 per cent see the government as having a duty to help people during difficult financial times, 57 per cent think that this duty should also come from the banks.

Despite this, 64 per cent still think that banks and other financial providers aren’t doing enough to help their customers during these difficult economic times.

But what do European consumers actually want their banks to do?

Forty per cent called for more tailored products, 37 per cent wanted money management advice, a quarter want banks to improve their digital services while a third seek saving support.

In addition to this, trust in financial services among European consumers remains a key issue and is acting as a barrier to enhancing services and improving reputations.

Just under one in five worry that banks will attempt to sell them products which aren’t right for them, and a similar number feel they don’t have their best interests at heart.

When it comes to their data, 56 per cent worry about how this information is used by banks and other providers, with consumers in the UK being the most concerned of all Europeans at 63 per cent.

This is despite an acknowledgement from consumers of the benefits data sharing can bring, with 35 per cent of people in the UK saying they’d be prepared to share more of their data if it improved their ability to borrow or access higher credit limits.

Nearly half would be willing to share more information if it meant banks could warn them in advance of potential financial issues.

Sara Costantini, regional director for the UK and Ireland at the credit bureau company CRIF
Sara Costantini, regional director for the UK and Ireland, CRIF

Speaking on how millions of UK citizens are already contending with the increasing cost of living, with one in five now expecting to borrow more over the next year, CRIF’s regional director, Sara Costantini explains how the majority of people in the UK feel lenders aren’t doing enough to help.

According to Costantini, consumers want to see banks offering more tailored products and services that meet their specific needs, as well as ways to lower their bills and to proactively flag any financial issues on the horizon.

“Innovations like open banking make this a possibility,” she comments. “The whole financial sector needs to work together to improve customer understanding and capitalise on the benefits improved data and analytics can bring.

“Only by doing so can we ensure more people get the services and support they need to weather these trying times.”

Author

  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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