According to a comprehensive report prepared by Havas Digital this past May, Chile leads Latin America in the use of e-banking services. Although the figures for the region are much lower than those of Europe or North America, growing Internet access and improved service connections have resulted in the clear growth of online services.
Chile has the largest percentage of people who use online banking services in the region at 34.8%, followed by Brazil with 30.5%, and Argentina with 24%. In Mexico and Colombia, the percentage of users of e-banking services is lower, at 14.7% and 21.7% respectively.
If we add non-banking online transactions offered on financial websites, this figure rises to 46% in Chile, 41.8% in Brazil, and 37.1% in Argentina.
According to Chile’s Superintendency of Banks and Financial Institutions (SBIF), a little more than 3 million Chileans (3,337,191) use online banking services, with a total of 178,758,369 digital transactions posted through December 2010. To put the size of these numbers into perspective, in the year 2000 the number of Chilean Internet users accessing online banking services was approximately 285,000, with a total of 6,827,651 transactions posted.
However, the study shows that despite these positive numbers, in Chile only 10% of users handle their more complex financial affairs online and only 9% use online support in making financial decisions. This is also the case in the rest of the region, although Chile has the highest numbers. In Argentina, 8% handle their financial affairs online and only 3.8% use the Internet for making financial decisions. Mexico and Brazil narrowly beat this figure, at 4.5%.
Gonzalo Parra, Havas Digital Manager for the Andean region, believes these numbers show that there is still great potential for monetizing online banking for companies that understand the behavioral changes of the online banking consumer.
According to Datamonitor Research, 50% of users do not know where or how to invest, and 70% would like more information on handling their finances. This data, coupled with the still low use of online financial tools, represents a great opportunity for banks.
In fact, according to the World Bank and McKinsey, there are 250 million people in Latin America who still do not use any type of banking services, making it the most “unbanked” region in the world.
However, users who do use online banking services pointed out that the most influential factor when choosing a bank was the institution’s website. In Argentina and Colombia, the percentage of influence was 71%, while in Mexico it was 70%, and 74% in Chile. Surprisingly, expert financial counseling came in second as the most influential factor in choosing a bank, after its website, at 71% in Chile and 68% in Mexico.
Even thought these figures highlight the use of web tools by banks, the digital advertising budgets allocated by banks are still very limited. According to Havas Digital estimates, banks in Argentina, Mexico and Chile assign only 4% of their ad budgets to online advertising, while spending 33% of their budgets on traditional TV advertising and 35% on newspaper ads. Moreover, the amount spent on roadside advertising is nearly 6 times that of digital advertising (with 23% of their advertising budgets allocated to roadside advertising).
In this sense, Parra emphasizes that "companies in the region need to improve integration among various channels to achieve the true benefits of digital communication. Just like other brands in more developed markets, banks in Latin America must develop and implement their digital tools in a consistent and comprehensive way, in order to permanently attract new customers and retain current ones."