There has been a near threefold increase in the number of Irish consumers embracing financial technology (FinTech) since 2017. This is according to the EY Global FinTech Adoption Index which examines the FinTech industry and demand for these services globally.
The index shows almost three-quarters of all Irish adults (71%) avail of FinTech services in one form or another, higher than the global average of 64%. Just two years ago Fintech adoption rates in Ireland stood at 26% - 7% below the global average of 33%.
The main reasons Irish consumers are availing of FinTech services, instead of more traditional financial services, are due to more attractive rates and fees on offer (37%), ease of which to set up an account (22%) and access to different and more innovative products and services (18%).
The index finds that Irish adoption is being driven by greater use of money transfer and payments (85%), insurance (63%), peer-to-peer payment and non-bank money transfers (76%) as well as insurance comparison sites (61%).
FinTech use is higher among the younger generation and at its peak in the 25 – 34 age groups (80%) across all categories, except insurance and financial planning. The report also reveals a steady increase of FinTech proposition adoption across all categories, except borrowing, as Irish consumers incomes increase.
Non-adopters cite their limited understanding (39%), trust of FinTech challengers (29%) as well as greater wariness of digital processes and channels (8%) as the main reasons for not transitioning from more traditional transaction methods.
Furthermore, Irish consumers are increasingly becoming more comfortable sharing their data with traditional financial services, FinTechs and non-FS companies. Similarly both adopters (69%) and non-adopters (68%) still prefer to interact with their bank through traditional methods, preferring the personal interactions to that of social media.
Commenting on the report, Head of Digital & CX at EY Financial Services, Niall Corrigan said, "What was once considered as complex and challenging, FinTech has seen a remarkable increase in growth in Ireland over the past few years, partly due to the rise of mobile-first platforms, but also driven by Irish Government initiatives to encourage FinTech innovation. FinTechs are continuing to gain traction in the Irish market blurring the scope and lines between traditional financial products and needs-based or lifestyle propositions."
He added, "Looking ahead, we see an increasingly ecosystem-driven approach towards managing consumer financial service. Demand for FinTech services are growing and the opportunity for innovative Irish FinTechs at home and abroad is strong and although some challenges have yet to be overcome, it seems that growth in the FinTech space will continue to reach new heights."