Each week, The Fintech Times takes a look at the top stories in British fintech. In today’s roundup, we look at how the pandemic has increased the number of brits shopping through social media, the number of ATM’s that are closing each month, and how UK SME leaders want accountants as their business partners.
Pandemic Causes increase in Social Media Shopping
New Mastercard research reveals that Brits have discovered new ways to shop on social media during the pandemic, as bricks and mortar stores were forced to shut, with 43% of those surveyed increasing their spending on social media in 2020 compared to previous years.
As a result of lockdowns and restrictions, many consumers have found new digital ways to get their retail therapy fix. 92% of people who shop socially say they had bought items via Instagram, followed by Facebook at 39%, YouTube at 22% and TikTok at 20%.
Younger people have been driving these spending trends, however, 54% of over 55s have admitted to buying more socially, due to using social media more during the lockdown. Efficiency and ease of purchase are the main factors driving the adoption of social shopping. 28%of Brits choose to shop on social media because they can pay at the ‘click of a button.’
The research also shows how influencers and tailored ads are a big part of the social shopping experience and driving sales. Nearly a quarter (24%) of Gen Z enjoy their favourite influencers linking products directly to buy, saving on browsing time. Similarly, 18% of Brits favour shopping on social media due to targeted ad’s and sponsored posts.
Janne Karppinen, Head of Retail for Mastercard UK said: “As the majority of retailers have transitioned to digital, social media shopping has grown significantly in the UK and marks a new environment for consumers to benefit from live recommendations from their favourite influencers, community and brands. We’re also pleased to see our nation use social media for good by supporting their local and small businesses and we expect to see that continue through 2021 and beyond the pandemic.”
Over 340 ATMs close on the UK high street every month in the face of coronavirus
A new report by UK merchant payment provider, Dojo, part of the Paymentsense brand, has revealed that between January 2019 and September 2020 the number of cash machines in Britain dropped from 62,967 to 55,674, a decrease of 7,293, with an average of over 340 machines disappearing from high streets every month.
York tops the list losing a third of its ATMs in just one year during COVID-19, dropping from 63 to 45. Edinburgh ranked second with a 24% fall in the number of ATMs. While London ranks third, the largest city in the country lost 192 machines between January ‘19 and September ‘20 a 23% decline
Jon Knott, Head of Customer Insight at Dojo said: “During the course of the coronavirus pandemic, the makeup of the great British high street has changed enormously. While it’s long been evolving in the face of the rising of the digital marketplace, coronavirus has reaffirmed the dominance of financial technologies.
“With more and more people opting for Apple and Google Pay which has no capped limit for contactless payments, consumers are welcoming the efficiency and speed at which they can purchase larger value products and services. It is no surprise then, in our digitised economy, that the use of cash is decreasing, making ATMs redundant.“
Cryptocurrency Study Reveals the UK is the 3rd Country Most Intrigued
Despite being launched in 2008, cryptocurrency has become of significant global interest over the last few years, seeing a 203% Google trends increase over the last year alone.
Invezz.com utilised the online analytics tool Ahrefs to discover which countries in the world are most interested in cryptocurrency. The US ranks first with 2,556,000 average annual online searches, the equivalent of 7,003 online searches per day. India in second 804,000, 69% lower than the US. The UK ranks as the third most interested country, with 648,000 annual online searches.
Research reveals UK banks top the global list for boardroom technology experience
UK banks now have more boardroom technology experience than their global competitors, according to new research from Accenture. Over a quarter (26%) of all UK bank board members in 2020 had professional technology experience, up from 14% in 2015.
Banks are ramping up their technology investments to keep pace with changing consumer demands, such as the growing need for digital interaction and remote working as a result of COVID-19. However, bank boardrooms overall lack the technological expertise to minimise the risks and maximise the benefits of their investments.
Accenture recommends that 25% of banks’ board directors should have technology experience. UK banks have the highest proportion of technology experience of all surveyed markets and is the only market to meet Accenture’s 25% recommendation, followed by Finland and Ireland (both 23%), and the US, which stands at 19%.
Laura O’Sullivan, Managing Director in Accenture’s Banking practice, said: “The rise in tech experience on bank boards is a logical result of their heavy investments in new technologies such as cloud computing and data analytics. Without the know-how at board level to advise on how these technologies will be implemented strategically, these investments could go to waste.
“In the UK, we’re seeing banks take on this expertise at a faster rate due to its leading fintech market. Government is hugely supportive of investment in both fintech and new competition, which has given birth to a number of highly competitive neobanks that the incumbents simply can’t afford to ignore. COVID-19 will only have accelerated investments in new technologies and digital services, which will amount to a big missed opportunity if banks can’t take on the experience needed to drive this agenda at pace.”
UK SME leaders want accountants as business partners
According to a global survey by Dext, SME business leaders in the UK want accountants to become future ‘business partners’ to help them shape and grow their companies believing the skills they offer are integral.
Younger tech-savvy business people in particular are keen to partner with accountants. Over half (56%) of 18-34-year-olds say they want their accountants to be business partners. 50% of 35-44 years old feel the same. Many businesses believe accountants make excellent virtual CFOs, according to the data. Over half (61%) of 18-34-year-olds say accountants are useful in this role while 55% of 35-44 years old feel the same.
Dext CEO, Adrian Blair, said: “It’s fantastic to see so many in the business community waking up to the power of accountancy. A good accountant, using the right software tools, can do so much for a business and people are now beginning to really understand this.
“It’s clear that having a full picture of business finances, in real-time, is critical to business success, and accountants are crying out for tools to help businesses succeed in these turbulent times. Recovery won’t happen overnight, but SMEs are the lifeblood of the UK economy, and supporting financial planning with expert accountant advice will help businesses move in a positive direction towards growth.”
London Remains an International Powerhouse
A new report by Zedra, titled ‘London Calling’ has found that the UK capital remains an international powerhouse for fintechs and other companies despite the Brexit transition and the ongoing impact of the Covid-19 pandemic. The report acts as a guide as to why London will thrive, as the more companies that base themselves in the Capital, the more London becomes the epicentre of world trade.
Companies in London scale faster than anywhere in Europe. There are more unicorns in London than France, Germany and Italy put together, as well as incubators, accelerators, and co-working spaces to help start-ups climb the first rung of the ladder. As companies grow, VCs and private equity investors are ready to inject capital to propel them skyward. London is the fourth most invested city in the world for tech and companies in London thrive with the network and support levels that this accolade brings with it.