Table of Contents
Executive Summary
-
- Key takeaways
-
- Figure 1: Short-, medium- and longer-term impact of COVID-19 on the financial services industry, July 2020
- Key trends and innovations
- US economic performance
- After slow and steady recovery from 2008, US economy falters during pandemic
- Market performance
- Short-term effects were mainly behavioral
- Medium term heavily dependent on health recovery
- Longer term will be driven by economic recovery and a shift to digital
- Looking to the future
-
- Figure 2: Mintel Trend Drivers – shifts for the financial services industry, July 2020
The Impact of COVID-19 on Consumers
-
- Majority of consumers are worried about their exposure
-
- Figure 3: COVID-19 exposure and life disruption concern, March 4, 2020 – July 7, 2020
- Consumer concerns reflect a grudging recognition of the next normal
- Following advice of medical professionals, consumers have adjusted their lifestyles
- US consumers still optimistic about their own financial health, but not of the country as a whole
- Mintel’s Global Consumer Trend Drivers
-
- Figure 4: Mintel Trend Drivers
Opportunities
-
- This is the time to be bold
- Remind consumers that the financial industry is sound and can offer support
- Stop making it so difficult for consumers to like you
- What it means
How a COVID-19 Recession Affects the US Economy
-
- US sees massive layoffs and furloughs due to shutdown
-
- Figure 5: Unemployment and underemployment, January 2007-June 2020
- Consumer confidence craters as the pandemic rages on
-
- Figure 6: Consumer Sentiment Index, January 2007-June 2020
- DPI increased over 13% due to government stimulus package
-
- Figure 7: Disposable Personal Income change from previous period, January 2007-June 2020
- GDP drops by nearly 4%
-
- Figure 8: GDP change from previous period, Q1 2007 – Q2020
State of the Market before COVID-19
-
- Financial services industry strong in pre-COVID-19 landscape, though signs pointed to a recession
- Account ownership was high
-
- Figure 9: Financial product ownership rates, October 2019
- Trust in the industry was low
-
- Figure 10: Trust in financial service providers, October 2018
Short-term Impact on the Industry
-
-
- Figure 11: Short-, medium- and longer-term impact of COVID-19 on the financial services industry, June 2020
- Banks were quick to close brick-and-mortar locations, pushing customers to digital and mobile channels
-
- Figure 12: First American Bank email, June 2020
- Figure 13: Banking activities in the past three months, November 2018
- Credit usage focused on using fewer cards to limit exposure
-
- Figure 14: Card favoritism versus card indifference, by generation, July 2019
-
- Figure 15: Citibank email encouraging contactless payments, March 2020
- Figure 16: Wells Fargo card and Apple Pay, March 2020
- Lenders begin to offer assistance for those struggling through the pandemic
-
- Figure 17: Attitudes toward debt, by generation September 2019
-
- Figure 18: Patriot Federal Credit Union direct mail piece, May 2020
- Insurance steps into its role as a health and wellness provider
- Health insurers educated the public about the coronavirus
-
- Figure 19: United Healthcare direct mail piece, April 2020
- Property & casualty insurance offered refunds to those driving fewer miles
-
- Figure 20: GEICO Facebook post, April 2020
- Investment into fintech contracts, but consumers will appreciate the innovation brought about by new technologies
-
- Figure 21: Simple email, April 2020
-
Medium-term Impact on the Industry
-
-
- Figure 22: Short-, medium- and longer-term impact of COVID-19 on the financial services industry, June 2020
- Consumers will be watching their finances more closely as the recession takes a stronger hold
- Meeting consumer needs:
- As the recession takes a stronger hold, card issuers have the chance to step up as consumer advocates
- Meeting consumer needs:
- Need for loans will remain high, and financially secure consumers might be convinced to make larger purchases
- Meeting consumer needs:
- COVID-19’s first wave continues across the US, and health insurers need to put priority on transparency
- Meeting consumer needs:
- Investment in fintech will slowly return as consumers become even more reliant on digital channels
- Meeting consumer needs:
-
Longer-term Impact on the Industry
-
-
- Figure 23: Short-, medium- and longer-term impact of COVID-19 on the financial services industry, June 2020
- Traditional banking behaviors will return, but consumers will expect more transparency from the industry
- Meeting consumer needs:
- US card customers will thoroughly embrace contactless
- Meeting consumer needs:
- Consumers will return to loans for large purchases
- Meeting consumer needs:
- Technological holdouts in insurance will embrace digital channels
- Meeting consumer needs:
- Interest in fintech will continue to grow, and new partnerships will emerge
- Meeting consumer needs:
-
Appendix – Data Sources and Abbreviations
-
- Data sources
- Consumer survey data
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
Back to top