Mumbai: Indians in the 50-60 years age group will adopt digital payment channels over the next 6 months post the Covid-19 crisis, reveals Capgemini‘s new study. This age group constitute around 80% of the older consumers in India.
Capgemini Research Institute conducted a study on Covid-19 and the financial services consumer analysing on how this crisis changed consumer behaviour in the financial sector – from channel preference to investment choices? How do people think the traditional banks and insurers have handled the crisis?
The study polled over 11,200 consumers in early April 2020 from 11 countries including India, USA, UK and China.
It found that pandemic has hastened the shift towards digital payments, increased digital channel adoption, spurred consumer interest in savings and safer investments, and drive customer loyalty towards those organizations that are handling this crisis well.
The key India findings from the report “COVID-19 and the financial services consumer: Supporting customers and driving engagement through the pandemic and beyond” including comparison with global counterparts are below:
Shift towards digital payments in India is particularly striking when we consider how consumer behaviour is evolving among segments – such as older consumers – that have traditionally preferred cash for transactions.
80% of the older consumers in India between the 56-60 years age group show the highest usage of digital payment channels in the next 6 months. This was followed by the 36-45 years age group at 83%.
The global average for an increase in digital payment channels in next 6 months between the age group of 56-60 years and 36-45 years stood at 43 % and 48% respectively.
Interestingly the report highlights that 80% of the Indian consumers who are older than 66 years and above mentioned that they will increasingly adopt digital payment channels in next 6 months compared to a 35% global average.
India ranks highest in the usage of digital payments in the current scenario and in next 6 months
The study highlights that the usage of digital payments amongst Indian consumers in the current scenario stood highest at 75%, followed by China (63%) and Italy (49%) against the 45% global average.
Also, in the next 6 months, the usage of the digital payment amongst Indian consumers will be highest (78%), followed by China (63%) and Italy (50%). While the global average on increase in digital payments usage in the next 6 months stood at 46%.
India has been ranked highest in the digital touchpoints use in the next 6-9 months; with strong growth in voice assistants and chatbots as emerging channels of interaction for banking and insurance segment
The impact of COVID-19 on the use of digital touchpoints amongst Indian banking consumers has seen a significant surge from pre-COVID19 period to the current period and its expected use in next 6-9 months.
57% of the Indian consumers according to the study were interacting on mobile app pre-Covid 19, increasing to 67% in the current scenario; and 74% of Indians will prefer interacting over the mobile app in the next 6-9 months.
The global average on a mobile app as a digital touchpoint stood during pre-COVID19 period (47%), current preference (52%) and expected use in the next 6-9 months 55%.
The study further mentions that 40% of the Indian consumers were using voice assistants and chatbots pre-Covid 19 as one of the preferred digital touchpoints for banking, and this will see a surge to 52% currently.
And further an increase of 59% of the consumers preferring to use voice assistants and chatbots over the next 6-9 months. This was the highest amongst the countries surveyed.
A similar trend has been witnessed in the insurance segment with 42 % of the Indian consumers using voice assistants and chatbots pre-Covid 19, seeing a surge to 50% currently, and a further increase to 57% Indians who will use voice assistants and chatbots in next 6-9 months for theirs.
The usage of voice assistants and chatbots as a preferred digital touchpoint especially in the Insurance segment was highest in India as compared to the other countries surveyed.
Indian consumers are becoming increasingly savings and safety-oriented. There is an increased appetite for saving and safety, which is likely to persist post the pandemic.
The study highlights that 85% of the Indian consumers prefer to save more in the next 6-9 months as compared to 80% in the current period and 72% pre-Covid 19.
Additionally, it has been observed 77 % of the Indians are preferring to increase their savings in safe instruments than investing in the stock market or any high-risk financial products in next 6-9 months compared to 73% in the current scenario and 66% pre-Covid 19.
Demand for insurance coverage is growing and highest in India compared to global counterparts
The study unveiled that India stood highest is increasing demand for insurance coverage with 83% of the consumers opting for an increase in Life insurance coverage in the next 6-9 months from 80% currently; and 70% in the pre-Covid period.
A similar trend was witnessed on demand for Health Insurance with 84% of the consumers opting for an increase in Health insurance coverage in the next 6-9 months from 80% currently; and 71% in the pre-Covid period.
Indian consumers are more satisfied with their financial service providers’ help in overcoming the stress in the current crisis, than their global counterparts
India stood highest with 78% of consumers mentioning that their primary bank/financial institution takes initiatives to help them overcome the current situation and stress (offers community help, counselling services, guidance for essential items, etc.). This trend was followed by China (74%), US (58%) and UK (57%). The global average stood at 54 %.
Indian Consumers show highest preference for assets with societal impact compared to global counterparts – Consumers are becoming mindful of sustainable investments
73% of the Indian consumers prefer to invest in assets which have a societal impact, even if they get lesser returns in the next 6-9 months compared to the global average of 39%. In the current scenario, 68% of the Indians prefer to invest in assets which have a societal impact compared to 36% globally.