Consumers' Attitudes to Borrowing 2014 - The Emergence of the Digital Borrower

CONSUMER ATTITUDES TO DIGITAL FINANCE

www.nostrumgroup.com @nostrumgroup

• Consumer Attitudes to Digital Finance 2014

• ‘The Emergence of the Digital Borrower’

• 2002 consumers surveyed

• 991 men, 1001 women

• Balanced UK representation

NOSTRUM’S RESEARCH

THE DEMANDING CUSTOMER


89% rank interest rate as most important factor, followed by transparency of information (80%)

71% expect cash in 24 hours or less

Consumers want the benefits of the payday market (eg instant decision-making and funds

transfer) but have become more rate-sensitive

Source: Nostrum Consumer Attitudes to Digital Finance research 2013 & 14

THE ONLINE CONSUMER


Almost all research into loans is done online, with 84% using a computer.

15% would use a device including a smartphone or a tablet.

90% own a smartphone (up 25% on 2013)



THE ONLINE

CONSUMER

Digital nativesDesirable regularsFuture natives

Capable massesTraditionalists


• Loves her iPhone and iPad

• Manages her life online and via apps

• Hasn’t set foot in a bank for several years except when her

Gran gave her a cheque for her birthday, which took her

several weeks to get round to paying in

• Doesn’t need to borrow money very often but is confident

handling her finances online

• Lately she’s been experimenting with various contactless

payments applications

Helen, 23 years old

DIGITAL NATIVE


Tom, 42 years old

• Has been with his bank for over 20 years

• Owns a smartphone but prefers to surf the web from

his computer

• Manages his bill payments online but if he has a query

he likes to ring the call centre

• Uses comparison sites when he is renewing his home

and car insurance, but he only takes out policies with

companies he has heard of

• Has a facebook account and likes to read what his

friends are doing, but rarely posts anything

TRADITIONALIST


Dave, 25 years old

• Organises his life via his smartphone

• Keeps in touch with his friends via Facebook,

WhatsApp and Instagram

• Orders his groceries online each week and does his

clothes shopping on sites like ASOS

• Manages his banking online but when it comes to

borrowing money he likes to speak to someone at the

finance provider

• Feels his limited knowledge means that’s the sensible

thing to do, although he’s gaining confidence as he

gets more experienced

FUTURE NATIVE


Gina, 40 years old

• Spends a lot of time online and loves a deal

• Regularly visits discount websites and only buys

clothes from her favourite retailer when they have an

offer on, which she knows they will do every few

months

• Uses comparison websites and will growth the

cheapest price available, irrespective of whether or not

she’s heard of the brand

• She’s influenced by online reviews and ratings

CAPABLE MASSES


James, 45 years old

• Confident managing all aspects of this life online,

particularly his finances

• Has bought numerous items on credit and has taken

out several loans in recent years

• Very familiar with the borrowing process and is happy

to take out and manage loans without talking to anyone

or visiting a branch

• As a regular borrower, he finds it useful to use an

online app where available

DESIRABLE REGULARS


OTHER TRENDS • Bank loans continue to be the most recognised product, with

93% awareness - but the banks have their challenges

• People who have taken out a loan in the last 12 months are

less brand-sensitive and more influenced by interest rates

• 36-45 year old borrowers have more knowledge than 18-35s

about niche products such as logbook loans (36% vs 17%)

peer-to-peer (35% vs 21%)

• Awareness of peer-to-peer lending has increased 87% since

2013

• 40% of people surveyed have never taken out a loan – this is

an opportunity for lenders who can offer cost effective finance

that aligns with people’s lifestyles



THE FUTURE • The next 12 months will be a defining period for online lenders

• Adoption of technology over the entire consumer lifecycle is

inevitable

• Children aged 12-15 only conduct 3% of their communications

on the telephone

• 94% of their communication is text based

• The digital borrower is set to be the dominant borrower in 2015

and beyond

• Lenders who stay in tune with consumer attitudes and maintain

visibility will be well-positioned to be their lender of choice time

and again

Sources: Nostrum Consumer Attitudes to Digital Finance research 2013 & 2014

Ofcom Adults’ Media Use & Attitudes Report – April 2014

LET’S MAKE LENDING, CHEAPER, FASTER AND SAFER

putting the customer in control of their finances, any place, any time and on any device.

The challenge is to ensure you satisfy your customer base.


FOR OUR FULL REPORT ON CONSUMER ATTITUDES TO

DIGITAL FINANCE VISIT OUR WEBSITE:

WWW.NOSTRUMGROUP.COM

Consumers' Attitudes to Borrowing 2014 - The Emergence of the Digital Borrower

Economy & Finance

Transcript of Consumers' Attitudes to Borrowing 2014 - The Emergence of the Digital Borrower