Consumers are increasingly valuing honesty and integrity of a loan provider when choosing their finance provider, research by technology provider Nostrum Group has found.
81% of the 2,000 surveyed said that transparent information was an important factor when choosing their provider. This was up from 70% in 2014.
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Nostrum said it had found millennials particularly wary of credit products. The company suggested this may be because they saw the effect of too much credit on their parents.
Transparent information was the second most important factor in choosing a loan, only behind a low interest rate (which was selected by 92% of respondents.
Low weekly/monthly payments and brand reputation were both selected by approximately three quarters of respondents, at 76% and 75% respectively. These numbers were unchanged from 2014.
Less than half of respondents (39%) thought having a local branch was important for loan providers, down from 50%.
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By GlobalDataReinforcing the idea that digital has lessened the need for local branches, just 14% of respondents could remember when they last visited a bank branch. Instead, over half (53%) said the used a mobile banking app.
Richard Carter, Nostrum’s chief executive, said: "The challenge to lenders is not just to provide lending facilities digitally. To appeal to existing or potential customers they need to be honest, transparent and able to provide a personal experience, all with a competitively priced product.
"Creating a personal touch and operating in a way that resonates with the consumer’s own core values, will differentiate in an increasingly busy marketplace.
"From a lender’s perspective, it will be pleasing to see customers acknowledging the role social data can play in underwriting. This may represent a recognition that consumers acknowledge their personal data will need to be shared in order to receive a higher degree of customer experience. At the same time, it indicates that if the lender is deemed trustworthy, providing this data will not be a huge issue."
