Over 60% do their finance online
In a revealing survey conducted by Expat Forum on behalf of Barclays International Banking, it was discovered that expats living in France don’t trust their beloved mobile phones when time comes to do their banking.
France is one of the most popular tourist destinations in the world and indeed is by far and away the most popular tourist destination within Europe. As a consequence the country has more than its fair share of expats and we gained some interesting information from our online poll asking “how do expats in France do their banking”.
We will now take a look at the specific answers from the French expat community and then consider the implications, trends and other factors which may well have influenced the vote.
Online banking (63.64%). Despite the figure of 63.64% is slightly less than the average for the overall poll which was 70.39% although there are a number of reasons why this may be the case. The French government is investing around €21 billion in an ultrafast broadband network although at this moment in time household penetration in France is only around 2%. However, if we add back in those who are currently out of the range of the fibre-optic network then the figure could increase to anywhere up to 21% penetration. So while the take-up of ultra fast broadband has been disappointing to date the overall take-up of broadband across France is more than acceptable.
As a consequence of broadband connectivity now being available across the vast majority of France it is no surprise to see that online banking is fairly popular. When you also take into account the fact that France houses some of the largest financial institutions in the world, both domestic and international companies, we can expect online banking to be heavily promoted in the short to medium term. There are very few banking institutions around the world who have not yet clicked onto the value of online exposure and the fact that they can reduce significantly the base cost of any business.
However, the worldwide banking arena is still suffering from issues relating to broadband reliability, broadband speed and security. As and when all of these issues are resolved there are many who believe that online banking will be as popular as walking down to your local bank branch was 20 or 30 years ago. Time will tell as to whether this will be the case but with more and more local branches now closing it seems almost inevitable that the push towards online banking will continue. The very fact that France is popular with European expats, who have probably been used to broadband connectivity and online banking in their former homelands, is also another reason why we should see figures increase in due course.
Mobile banking and traditional banking, out of the French international community’s mind
The fact that nobody voted for mobile banking, which for this purpose we will assume to be mobile telephone banking and mobile broadband banking, is something of a surprise when you bear in mind the overall figure for the poll is 8.90%. When you also take in account the fact that Free Mobile in France recently announced 4 million home-based hotspots for mobile broadband users it is something of a puzzle as to why the figure is so low.
Expats around the world seem to have accepted mobile banking as part of their everyday activity with mobile telephone banking very popular. For many people mobile telephone banking is simply a backup for their online banking services in the event that broadband connectivity is unreliable or not available. There are very few banks around the world which do not have any call centre facilities for their telephone banking customers and indeed many have been repatriated from overseas countries such as India and Pakistan were the quality of service was questioned by some customers.
The situation in relation to mobile broadband banking is again very surprising because as we commented above there are now millions upon millions of mobile broadband hotspots dotted around the country. This significant investment in mobile broadband technology will almost certainly see more and more companies looking to encourage this particular service. Quite why so few expats have adopted mobile telephone banking and mobile broadband banking is something which we will have to look into at a later date.
On the surface it seems that mobile banking is dead and buried in France although this is certainly not the case and we fully expect these figures to increase in the short, medium and longer term. Whether reliability is a major issue at the moment is something to debate.
Again it will surprise many to see that nobody suggested any other form of traditional banking although we have had cash suggested in other areas of the poll. Local branch banking and online banking grabbed the lion’s share of the poll although postal banking usage is significantly higher than average in France.
Local branch banking (27.27%)
The figure of 27.27% is significantly higher than the overall average of 12.22% in relation to local branch banking. The vast majority of expats around the world will have seen a significant reduction in the number of local bank branches available in their former homelands although the situation could well be slightly different in France. These figures seem to indicate more interest in local branch banking although it is almost certain that the number of branches available in France will be reduced in due course to assist in slashing business base costs.
When you also consider there are potentially language issues in relation to local branch banking in France the significantly higher figure is even more surprising. However, the vast majority of the French population speak English as do the vast majority of expats around the world – perhaps we have found a common dominator?
The availability of local branch banking has been falling dramatically over the last few years across the world. The days when you could step into your local bank and build up a rapport and a relationship with the bank manager, and bank advisers, have long gone. Many expats, and traditional banking customers, complain that you are no longer a person in the eyes of the banking industry and are in many ways just a number. Whether this is actually the case is open to debate but some banking customers do feel that way.
Postal banking (9.09%)
Again postal banking is more popular in France at 9.09% against 4.55% for the overall poll. The fact that local branch banking and postal banking are more popular in France than anywhere else among the more popular expat destinations would seem to indicate a reluctance to embrace and appreciate new technology. However, as we mentioned above, the French authorities have put aside €21 billion to invest in an ultrafast broadband network which will eventually incorporate the vast majority of the country. As a consequence, this seeming reluctance to embrace online banking, mobile banking and mobile broadband banking does not stack up.
One of the main issues with regards to postal banking is the time delay in posting your instructions and having your instructions executed. There is no reason why e-mail, with the option to connect various documents, should not replace traditional postal banking although again you would need to have a reliable broadband network. This figure is almost certain to fall in the short, medium and longer term because many experts and indeed many customers believe that postal banking is a thing of the past. Indeed, if you are an expat living in France have you ever used postal banking?
While sometimes it is difficult to convince people to incorporate and embrace the latest technology there is no doubt that the Internet has literally changed the worldwide society we live in. Businesses have realised there is an opportunity to reduce their base cost, customers have realised there is an opportunity for a more convenient service and these two factors have certainly fed the monster that is the World Wide Web. Traditional banking methods are falling by the wayside although from these poll figures it would suggest that France is perhaps behind the curve.
Background to the poll
Will now take a look at the various issues which have arisen during this poll and various factors which will most certainly influence whether expats in France decide to go online or whether they decide to stay with more traditional banking services.
Security has been and continues to be a major issue in the world of online banking and each and every security breach makes the situation more difficult for the banking world. Each highly publicised security problem places yet another hurdle between the banking industry and its customers and has in many ways delayed the inevitable move to majority online banking. But who is to blame for the security breaches? Aimed to explain how you can do your banking in the most secure way, Barclays Wealth and Investment management offers a handy security guide.
The vast majority of the media and indeed the vast majority of banking customers around the world immediately point their finger at the banking community. However, it is well-known that while there have been mistakes in the past and there will be issues in the future, the banking community as a whole has invested billions upon billions of pounds into online security. There have been significant successes in blocking further security breaches although these are not publicised because they would potentially cause more unrest amongst customers than they would benefit the banking community.
It is also worthwhile noting that while the banking community has an obligation to invest into and improve online security, each and every customer and every World Wide Web user also has their own obligation. Unless customers have the latest anti-virus software, security software and dismiss out of hand unsolicited third-party requests for financial information then the chain of security will be broken. We need to play our part in protecting the worldwide web and indeed we all need to play our part in protecting the worldwide online banking industry. Online security software is readily available across-the-board and indeed many banking companies are now offering online security software as part of their online banking package. If you are an expat and you’re looking to use online banking then you should certainly look into this further.
The most popular services in the world are those which are readily available and very convenient for customers. Online banking, mobile telephone banking, mobile broadband banking, local branch banking and postal banking are no different. Whether you enjoy the convenience of logging on to your bank account at some of the most unsociable hours of the day or indeed you appreciate the opportunity to use telephone banking as and when required there are major degrees of convenience which come into play. When you also take into account how convenient mobile broadband banking, local branch banking and postal banking can be to some elements of the expat society then we begin to build up a picture of very different requirements.
The truth is that each and every expat in France will have a different view on online banking, traditional banking and any other form of banking. Some will trust the banking community to protect their data while others would prefer a more convenient method of going down to the local branch and speaking to somebody face-to-face. The postal banking service and the online banking service are at very different ends of the banking industry spectrum and there are some options in between. In reality we are all very different, we have different views, we have different requirements and we have different trust issues. However, it seems almost inevitable that as the online banking industry gets more and more to grips with online security this service will dominate for years to come.
Reliability, as well as convenience and security, is also another issue which many people will hold close to their hearts especially where their finances are concerned. There is no point having mobile broadband banking or indeed traditional online banking if the broadband network is unavailable in a particular area of the country. A number of expats seem to use mobile telephone banking as a fallback and a backup for the online industry which does seem to make sense.
However, as the French government readies itself for a €21 billion investment in an ultrafast broadband network, worldwide banking companies continue to invest billions of dollars into security and reliability, it seems inevitable that traditional banking will disappear in due course. We have made great strides from the early days of the worldwide web where broadband connectivity was relatively rare and speed was a major issue. Developments in technology continue to impact upon every area of our everyday lives and the banking arena is one which has certainly embraced new technology and new systems. The trust factor and reliability very much go hand-in-hand.
The French authorities, and French broadband providers, have committed to investing billions of euros into the French broadband industry. Some of the figures in the online poll were slightly surprising in particular the 0% take-up of mobile telephone banking and mobile broadband banking. Local branch banking and postal banking also fared better than the average figures for the overall poll although it seems dangerous to suggest that French expats and the French community as a whole have not embraced the Internet or new technology.
As members of the Eurozone move very much closer to becoming one entity we will see significant investment in new technology and in particular broadband networks across the Eurozone and Europe as a whole. Whether or not some of this investment will be delayed due to the ongoing financial constraints impacting many European governments at this point in time is debatable but there is no doubt that there will be a major return on investment, assuming the business plan is solid, in local broadband networks.
The banking community as a whole has certainly embraced new technology and the ongoing investment in the online arena will continue forever and a day. Traditional banking is for many people a thing of the past and it was surprising that some of the more traditional banking services did fair better than expected. As the trust factor, convenience, reliability and security issues are addressed by the online arena as a whole, as opposed to just the banking sector, we should see more trust from consumers and a larger take-up of online services. This poll has given us a very interesting view of the way in which expats in France do their banking and indeed has enabled us to compare and contrast different countries offering a novel insight into the worldwide banking arena.
A growing number of expats around the globe have led to an increase in focused expat banking services around the world. Many banks realised some time ago that there is significant potential income from this arena and the number of expat exclusive financial arrangements now available continues to grow. The ability to speak to somebody who can relate to their expat issues and their banking questions is something of a godsend to those starting a new life overseas. Any service which can reduce the pressure they may feel upon landing in a newfound homeland would be welcomed with open arms.