Young people struggle to trust financial institutions to act ethically, research reveals

By Puja Sharma

–Strong attitudes of the younger generation in the UK serve as a stark warning to financial institutions to prioritise programs and practices driven by ESG

-Survey results emphasise, the importance of offering responsible and ethical solutions to avoid losing customers, revenues, and reputations

 etika, a people-first finance provider of fair and ethical finance, has released the results of a new consumer insights survey exploring the attitudes of young people in the UK towards the environmental and social impact of financial products.

The survey shows a profound shift in generational attitudes when it comes to what is expected from financial institutions. With only 29% of young people trusting financial institutions to act ethically and 80% of young people looking for ethical endorsements when making purchasing decisions, the survey results serve as a stark warning to financial institutions that are not prioritising ethical programs and practices.

Against the backdrop of a difficult economic climate, and with FinTech funding falling by a third globally to $63 billion in 2022, these survey results demonstrate that financial companies need to be aware of and be able to respond to changing user demographics and attitudes towards environmental and social issues if they are to be successful.

Commenting on the survey’s core findings, Robert Schuijff, CEO of etika, said, “These survey results serve as a much-needed wake-up call to other financial institutions and finance providers to lead by example and create a more openly ethical financial industry. Companies only that pay lip service to ESG and ignore the growing demands from their customers for socially responsible and ethical ways of doing business will suffer the loss of customers, revenues, and reputations.

“We are committed to putting consumer needs and priorities at the heart of our business and have the ability to serve distinct segments and varied demographics. We take these survey results as an indication that we are on the right track with our vision and mission, and will continue to only build partnerships with like-minded businesses which are aligned with our ethical values. We’re also proud to say that we are on our way to becoming a B-Corp in Australia, a clear and widely-recognised endorsement for our people and planet focused-approach to business.”

The release of this survey marks an exciting moment in etika’s growth trajectory, with the company on a mission to make POS finance less complicated and more ethical by becoming a tool for financial well-being. Founded in 2012 by a group of technology entrepreneurs, etika works to deliver affordable finance options in a socially responsible way by bringing clarity to credit agreement terms and conditions, with fair merchant fees.

Key highlights:

• Around 78% of young people have considered the social and environmental impacts of financial products;
• Over 93% of young people would be more likely to choose a financial institution that strictly invested in ethical programs;
• Only 39% of young people surveyed would be surprised if they found out a financial institution they held a product with was found to be acting unethically;
• About 87% of young people agree financial institutions should make information about the social and environmental impacts of financial products more easily available.