However, when both positive and negative sentiments are considered together, Brazil comes much lower – ranking in ninth place. Brazilian consumers not only have the fourth largest positive sentiment result recorded in the EY Open Banking Opportunity Index, but also the largest negative sentiment.
As is often the case with survey results, digging deeper into the figures helps understand the findings. We found a strong correlation between youth, income and willingness to embrace open banking – with some exceptions. The younger the person, the higher their enthusiasm; and consumers with the highest incomes were far more predisposed to the concept than those with lower incomes. In fact, the lower a person’s income, the more intense their negative reaction to open banking.
Survey respondents in the 34-44 year age range with a high income were the most likely of all groups to reject open banking. This is worth noting as these consumers are the most active users of banking services. The reasons behind their negative sentiment are not clear, though it may be because people with this profile are more likely to have already used a digital bank and may have had a negative experience, or do not understand the benefits.
Banks may have an edge – for now
Even with infrastructure upgrades and regulatory supports in place, open banking will not reach its full potential in Brazil without greater levels of consumer trust. Almost one-third (31%) of consumers we surveyed said they were worried about cyber risks associated with open banking and 36% said they intend to keep their banking data as private as possible.
Banks and FinTechs will need to overcome these trust issues if they are to make the most of open banking. This may be best achieved by developing initiatives that deliver clear benefits to consumers, while boosting their confidence in the security of data. Brazilian consumers have made it clear that they welcome innovation that makes banking easier and cheaper. Thirty percent said they expect open banking to allow them to access more banking services on their phone. And 29% told us they thought open banking may help reduce banking rates and tariffs.
But, consumers also want stronger assurances that data will be protected, and that banks will reimburse them for any losses incurred due to open banking breaches. Brazil’s banking customers make it clear that, to win them over, they want more evidence of how open banking will benefit them.