A lack of guidance is holding people back from making more prudent financial decisions, according to new research from award-winning Open Banking, Open Finance and Payments provider Moneyhub.
In a sign that some financial service providers are not delivering on their FCA Consumer Duty requirements, a quarter (24%) of consumers state that their investment and pensions providers fail to provide good quality support and after-sales care.
The research points to a concerning disparity in guidance and advice between consumers falling within different income brackets. While 42% of people say they don't find it easy to interact with their provider, this shrinks to only 15% of those earning £100,000 or more. For higher earners, 40% strongly agreed that their provider offers them a personalised service, compared to an average of 13% for those earning under £100,000.
Technological shortcomings can be at least partially to blame for the guidance gap. A fifth (21%) of consumers said that being able to make flexible top-ups, based on how much they have spare each month, would encourage them to add more into their pensions or investments. In a similar vein, 16% stated that they would benefit from easy to access projections on what their current savings could be worth in the future.
Open Finance offers a simple route for providers looking to incorporate such propositions into their offerings. Alongside being able to find and view all their pensions data, Moneyhub’s technology also allows consumers to connect to and see their bank accounts, credit cards, savings, property valuations, ISAs, loans, mortgages, and other financial products all in one place, allowing them to make better long-term financial decisions and embed healthier money habits.
Mark Horwood-James, Managing Director at Moneyhub Personal Finance Technology said:
“With the current availability of customer-focussed solutions through Open Finance and Open Banking technologies, there’s no reason for consumers to be still struggling with feelings of uncertainty or neglect. Through the advance of technology, good financial guidance does not have to be exclusive to those who are wealthy enough to pay for the privilege.
“The opportunity is clear for financial service providers: empower customers to make better financial decisions and, in the process, improve their financial wellbeing and ability to save or invest. The race is on to deliver the best solutions and experiences that benefit all customers.”
Margaret Snowdon, OBE said:
“The adoption of new technologies, especially in the form of Open Finance and Open Banking solutions, performs two important actions at once for pensions and investment providers. On the one hand it is the only way to face up and respond to the new FCA Consumer Duty demands - the key elements of the relationship between the provider and consumer can all be addressed through the simple adoption of already available technologies. On the other hand, the technologies improve the customer’s chances of making the correct financial decisions at the right time, thus bettering outcomes for themselves and their provider.”
To read the full report, please visit https://go.moneyhub.com/gift-for-you-pr.
About the research
The Survey was commissioned by Moneyhub in December 2023 and conducted by market research leaders, 3Gem Research and Insights. With an equal gender split of 1,000 respondents aged 25+ and from a variety of socio-economic backgrounds, each consumer was asked a standardised set of 18 questions relating to their pensions, investments and wider financial wellness.
Contacts
Ingrid Anusic
Marketing Director, Moneyhub
ingrid.anusic@moneyhub.com
M: +44 783 722 6553
Eleanor Ross
Senior Account Director, Teamspirit (Moneyhub PR Agency)
ERoss@teamspirit.co,uk
M: +44 7393 758 446
About Moneyhub
Moneyhub’s goal is simple; to work with clients to improve the financial wellness of people, their businesses, and their communities. Hundreds of companies use our award-winning Open Banking and Open Finance technology to better understand their customers through data so they can comply with Consumer Duty, deliver them more suitable products, and automate money management or payments to ultimately increase their capacity to spend, save or invest more.
To find out how to give the gift of financial wellness, and reap the rewards, please visit www.moneyhub.com.