A survey conducted by FIS PACE outlines the increasing trend of digital banking across generations and their needs
According to a new report released by the FIS PACE, which surveyed Indian adults in June 2020 and April 2021, the Covid-19 pandemic has accelerated the adoption of digital payments in India, with 68 percent of Indian consumers now using online or mobile banking apps to conduct their financial transactions. The survey focuses on how the epidemic has impacted consumers' wallets. Consumers have been compelled to switch from cash and checks to digital payments as a result of the epidemic, according to the research.
Bharat Panchal, Chief Risk Officer, APMEA, FIS said: “The pandemic has led India to a new phase of digital payments adoption. To be successful, the banking sector must provide technology-centric strategies which meet the diverse preferences of consumers’ rapidly changing habits, while also driving financial inclusion for underserved communities around the country.”
The Survey presented the financial facilities people of different age groups are demanding the most during the pandemic. The age groups are divided into Gen Z-ers (18-24), Young Gen Y-ers (25-29), Senior Gen Y-ers (30-40), Gen X-ers (41-55), and Older Consumers (56+).
Gen Z-ers: They are divided between students who are more likely to have a family safety net and employees, many of whom are in precarious employment situations. Faster payments and higher limitations on remote deposits are critical requirements.
Young Gen Y-ers: Orientation to the digital world has been observed by the survey. One-quarter of respondents had started a new job in the last year. The high use of the Book Now Pay Later (BNPL) facility is a sign of financial difficulty. Their banks must be flexible in terms of loan conditions and limitations.
Senior Gen Y-ers: Many people who lost their jobs at the start of the epidemic are still struggling. For dipping below normal quarterly balances, one-third of people seek exemptions from their banks. Paper payments are being rapidly replaced by mobile payments.
Gen X-ers: Early in the epidemic, many Gen Xers faced severe employment losses. They have similar requirements as others, although their urgent requirements have decreased. They lag behind younger generations in terms of digital adoption and their usage of digital payments has grown considerably in the last year. As paper cash went out of favour, the number of Gen Xers who used digital payments increased between 2020 and 2021.
Older Consumers: Many retirees are protected against job loss. In comparison to younger generations, there is a low level of deception. Although digitally behind, many people in this age group still shun in-branch encounters.
A Surge in Financial Fraud
The FIS PACE research also discovered that throughout the pandemic, there was a substantial increase in financial fraud, with customers increasingly preferring internet choices for transactions. Consumers are becoming increasingly exposed to cyber criminals, with 34 per cent reporting financial theft in the last year. This figure climbs to 41 per cent among Gen Y. (age group 25-29 years). Phishing was the most common method of financial theft, followed by QR code/ UPI scams, although customers were also victims of card scams and skimming.
In the last 12 months, 38 per cent of Gen Z-ers had been the victims of fraud. Nearly one in every five people has been a victim of phishing, and 15 per cent have encountered fraud with QR codes or UPIs. Some Generation Z cardholders have also been victims of card frauds or skimming. This indicates that data security and privacy, as well as clarity about how cardholder data is utilised, are important in establishing confidence.
In the last year, over 40 per cent of Young Gen Y-ers and Senior Gen Y-ers had been victims of fraud. Throughout the year, cardholders saw an increase in frauds and skimming. As a result, worries about data security, privacy, and openness are growing. Compared to the young generation, older consumers faced less fraud. During the pandemic years, effective data security measures across generations of online finance operators became more necessary with the growth of digital banking.