Are you sure?

Data security fears hinder spread of online banking services

While Hungarians are generally well prepared to handle their finances compared to other countries in the region, the popularity of online banking services is significantly held back by data security concerns, according to regional research by Big Four professional services firm EY.

The survey notes that while the general use of smartphones is widespread in Hungary, online banking is still done on desktop platforms. About 90% of the surveyed Hungarians use computers for banking, while 42% use smartphones, and only 20% use tablets.

The majority of Hungarians (71%) are prepared to handle their finances online, yet only 42% are using the digital services of banks and insurance providers consciously, the survey finds. Some 71% would generally like to rely on online solutions in all aspects of life, which is well above the CEE average (44%). Still, nine out of ten Hungarian respondents say they are concerned about personal data falling into unauthorized hands during online purchases.

"In Hungary, people are open to applying digital technologies, even in a regional comparison," says Ákos Demeter, partner of EY Hungaryʼs advisory branch. "A significant portion use the internet to download television or music content, and to reserve accommodation. This also appears in their handling of finances, as the vast majority of people use internet banking actively."

Even so, adds Demeter, the range of financial products available online is currently narrow, and in the coming period banks will have to make a step forwards in online service development.

"This way, demand may grow for financial products that are scarcely or less frequently used, such as online loan products or savings accounts," he observes.

The EY partner adds that, parallel to this, financial institutions may also need to improve in the area of data protection, as increased digitalization means an increasing security risk for consumers, which may hold them back from using new technologies.

EY conducted the survey on a sample size of 3,600 respondents in the region.