Internet is vital for expats for banking and staying in touch, research shows

by Ray Clancy on October 31, 2012

Majority of expats prefer online banking, survey finds

The internet provides a vital resource for expats across the globe both to stay in touch with family and friends and manage activities in their home and host countries, a survey has found.

Online banking is by far the preferred choice for all banking transactions and interactions among expats with bank accounts, with 79% of expats doing their banking online when making a payment, the HSBC Expat Explorer 2012 survey shows.

In comparison, 20% of expats make a payment face to face in a branch, while just 7% use the telephone and 5% use mobile phone apps.

Location plays a role in how expats would choose to liaise with their bank. In the Middle East, face to face banking is more appealing for making payments. Some 38% of expats in Oman go into a branch, 30% in Kuwait, and 26% in Saudi Arabia, the United Arab Emirates and Bahrain. This compares with just 16% in the United States, 12% in New Zealand and 10% in Australia.

For some banking interactions, this trend is even more pronounced. More than half, 55%, of expats in Oman would prefer to research products and services in branch compared to a global average of only 21%, highlighting that despite the increasing digital opportunities for services such as banking, face to face interaction remains more important across certain geographies.

The survey also shows that expats have responded to global economic woes by altering their saving and investment patterns, with a heightened preference for longer term investments.

The trend is most pronounced in the shift from cash to property investments. Nearly a quarter, 22%, of expats said the highest proportion of their investments are now held in real estate, compared to only 16% who held investments in this form when they first became expats.

The pattern is accentuated in countries most affected by the Eurozone crisis such as France where 37% invest in property now compared with 29% when they first relocated, and the UK where it is18%, up from 10%. While less pronounced, the trend is also mirrored in Italy, 28% up from 23%, Germany 18% up from 14% and Spain 39% up from 35%.

But the shift to real estate investment comes at the expense of cash savings. For European countries such as Spain and the UK, the drop in proportion of cash savings has been as much as 8% during the course of living in the country. In Spain 25% of expats held the majority of their investments in cash compared to 17% now and in the UK the proportion of cash savings has dropped from 38% to 30%.

The most notable drop in proportion of cash investments comes from expats living in Australia, where 42% of expats held the highest proportion of their investments in cash when they first moved. That figure has since dropped to 29%. A similar pattern prevails in New Zealand where it was 34% upon relocation compared to 18% now. Given the high proportion of retirees and expat lifers within these countries, this move could be as the result of expats setting up long term commitments in the country, said HSBC.

India, the UK and Australia top the list of popular ideal retirement destinations, followed by the United States and Canada. Expats said that the main reasons for choosing where to retire are quality of life, having family in the country and the weather.

However, despite the UK and India being reported as the most popular ideal retirement destinations according to expats, France and Spain continue to dominate as the actual expat retiree hotspots. Some 41% of respondents living in France are retirees and 32% in Spain compared to only 9% of expats overall.

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