Canadians becoming less dependent on banks: survey

TORONTO – A new survey from EY suggests Canadians are becoming less dependent upon their banks as the main providers of financial services.

The business consultancy firm says a quarter of those polled agreed with the statement, “I’m less reliant on established (financial services) companies and banks these days, as there are more options to self-manage my finances.”

Another five per cent of the respondents strongly agreed with the statement, while 21 per cent disagreed, five per cent strongly disagreed and 39 per cent said they neither agree nor disagree. Another four per cent said they don’t know.

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The top reasons cited by consumers for considering a non-bank provider included more attractive rates, access to different products and services, how easy it was to set up an account and a better online experience.

The online survey of 2,021 Canadians was conducted between January and April 2016.

The polling industry’s professional body, the Marketing Research and Intelligence Association, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.

Banks and traditional financial services behemoths have been facing growing competition from the slew of new tech-savvy startups sprouting up recently, offering everything from personal and business loans to online investment management.

EY reported that 36 per cent of those polled said in the past 12 months they have used an online-only financial product or service from a fintech startup, an investment firm, or a company not in the financial services space such as a retailer.

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Another 20 per cent said they haven’t tried any but would consider doing so in the future. Meanwhile, 23 per cent said they haven’t and wouldn’t consider it, while 20 per cent said they don’t know or aren’t sure.

“The results of our survey show a changing attitude towards traditional banks, as people look for an enhanced customer experience, simpler products and high-quality advice,” Paul Battista, EY’s financial services advisory leader, said in a statement.

“To stay relevant, especially as financial technology companies, or fintechs, are taking a piece of the market, traditional banks need to build on their strengths — including brand, trust and community presence — and invest in a superior customer experience.”