I went to the MRS’ annual financial services conference yesterday. A great day, lots of interesting presentations and good to see some new (and old) faces. Here are five things that struck me most.
- Radical changes happen slowly
Brexit will affect all businesses. But SMEs aren’t reacting in large numbers to the potential impacts just yet. At the moment, they’re unsure what to react to so it’s a waiting game.
Open Banking launches in January. But consumers aren’t clamouring for it. We expect take-up to be slow and then accelerate as people see the benefits, and as behaviour changes attitudes. People won’t just adopt ‘tech for tech’s sake’.
- There’s huge potential for social investments
Around 5m people are attracted by the idea of ‘good saving’ and feel they have the money to invest. Young people in particular value social purpose over returns. They want their money (what little they have!) to be used for good and to bring local benefits.
A client of mine, Bristol Energy, enjoys similar appeal among the same group. It tackles fuel poverty, while at the same time reinvesting profits in local renewables and the local community.
- Women are a powerful group underrepresented in finance
Women are living longer. More women work in professional jobs and more are entrepreneurs. But they’re less engaged in financial services, particularly longer-term finance like pensions and investments. They’ve invested less and invested in cash.
This could have profound implications. As women live longer, they may find their lack of investments and lack of appetite for risk means they don’t have sufficient assets for a comfortable retirement.
- We can’t assume people are numerate
Around half of UK adults have the numeracy of an 11-year-old or below. Around 11m adults in the UK are overconfident in their maths skills. This group is more likely to misuse credit and miss bills. This is a significant challenge (and risk) for the sector – both in terms of financial capability and how it communicates to this vulnerable audience.
- The best insight comes when we bring together different data
Like Sherlock Holmes and Dr Watson, the best insight teams bring together huge analytical power with great storytelling. This example was used by Strive and Splunk to espouse the benefits of pairing big data with market research.
But I’d follow a different analogy. You don’t just need data and research. You need to bring together many more sources of information. Competitor intelligence, trends, regulation, industry news and external research all have a role to play. When all this information is synthesised, you reach a higher level of insight and really start to solve problems. Perhaps less Holmes and Watson, and more The A-Team.
Acknowledgements of presenters and their contributions:
- BDRC, Ipsos MORI, Gusto, Open Banking, Chime, OpenMind and HSBC
- The Money Advice Service and Harris Interactive
- Splunk and Strive