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Fintech: Open Access research exploring new frontiers in financial technology

Strathprints makes available Open Access scholarly outputs by the Department of Accounting & Finance at Strathclyde. Particular research specialisms include financial risk management and investment strategies.

The Department also hosts the Centre for Financial Regulation and Innovation (CeFRI), demonstrating research expertise in fintech and capital markets. It also aims to provide a strategic link between academia, policy-makers, regulators and other financial industry participants.

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Consumer decision-making styles and the purchase of financial services

Howcroft, Barry and Hewer, Paul and Hamilton, Robert (2003) Consumer decision-making styles and the purchase of financial services. Services Industries Journal, 23 (3). pp. 63-81. ISSN 0264-2069

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Abstract

This article seeks to augment our understanding of consumers' attitudes and motivations when purchasing financial products. Using insights gleaned from focus discussion groups and a quantitative survey of consumers it focuses upon understanding the extent to which consumers' attitudes and behaviour differs for a range of financial products. Within the traditional structure and operation of the financial services industry consumers appear to express little choice. The rigid structure of the industry, coupled with the operation of cartels, meant that consumers had to accept the form and price of financial products and delivery channels. However the critical impact of deregulation and the emergence of new forms of technology have altered this situation by producing a highly competitive market for financial services. Consumers thus appear more disposed to change their attitudes when purchasing financial services. The outcome of these changes is that financial providers are now less certain of retaining their profitable customers or of cross selling high value products (such as personal pensions and investment products). It is, therefore, imperative that financial service providers better understand their customers' attitudes in an attempt to influence consumer decision making styles when purchasing financial products. This article accordingly seeks to analyse and understand more fully consumers' decision making styles for a range of financial products, including current accounts, insurance products, credit products and investment products. In the conclusion an assessment is made of the findings and the broad strategic implications for financial providers are examined.