Research Shows Industry More Trusted in Developing Markets Significant Gains for Banking and Insurance
NEW YORK, May 7, 2024 – The global public’s trust in the financial services sector has reached its highest level since 2012, according to the 2024 Edelman Trust Barometer Supplemental Report: Insights for the Financial Services Sector. The research, released today, showed that 62 percent of respondents trust financial services companies to “do the right thing,” a 4 point increase from last year and, for the first time, narrowly earning the industry a rank in the “Trusted” category (60 percent or more). Globally, trust in the financial services sector now ranks at an all-time high in just over half of the countries surveyed, half of which are categorized as developing markets.
“While financial services has made great strides in trust levels over the last decade, the industry still has a long way to go to reach solid footing in trusted territory,“ said Lex Suvanto, CEO, Edelman Smithfield. “To do so will require companies to execute trust building communications strategies about how they are improving financial well-being and creating stronger financial systems, and ensure that is effectively conveyed to their key stakeholders.”
The research uncovers a divide between developing and developed markets’ views on the financial services industry. Highlights include:
- Trust levels are at their highest in countries such as India (83 percent) and Thailand (81 percent).
- Nigeria and Colombia saw double-digit growth in levels of trust since last year.
- Financial services companies are still distrusted in the majority of the G7 countries. Trust levels under 50 percent represent distrust.
- Financial services scored below that level in Germany (41 percent), Spain (41 percent), France (45 percent), Japan (47 percent), Italy (44 percent) and the UK (49 percent).
- Financial services is in the “Neutral” category in North America – U.S. (55 percent) and Canada (59 percent).
The difference in trust in financial services between developing and developed markets can be attributed to individual experiences, accessibility to products, and the industry's capacity to improve business and individual lives within each local context. In developing nations, the majority of the population often depends more on traditional banking services and values trusted relationships due to the limited availability of advanced products and technologies. Conversely, in developed countries, trust expectations are higher, fueled by rapid innovation in new products as well as a growing demand for convenience and efficiency. Citizens in developed countries are often more focused on industry complexities and scandals that could potentially impact trust levels negatively.
Now in its 24th year and the most-cited source of information on the topic of trust in institutions, the Edelman Trust Barometer polls more than 32,000 people in 28 countries. The Financial Services Insights of the Barometer examines what people think about the companies they rely on, work for, and entrust with their money.
Banking is the most trusted financial services sub-sector globally
While levels of trust increased among all financial services sub-sectors, banks have seen one of the biggest shifts (+4 points year over year (YOY)) and now have a trust score of 66 percent. Banks are trusted in 16 of the 28 countries and consistently trusted regardless of age, income or gender. Over the past decade, trust in banks has jumped 12 points. Insurers have also moved into the trusted category this year: the scores for personal insurance and property/casual insurance rose by 2 points to 62 percent, and by 4 points to 60 percent, respectively. Investment management remains in the “Neutral” category, but has seen a 4-point uptick in Trust YOY. At the lower end of trust: cryptocurrency/digital assets; the sub-sector remains firmly within the “Distrusted” category with a score of 38 percent.
Other Key Findings
- High-income individuals are 12 points more trusting in the financial services sector than their lower-income counterparts. Over the past 10 years, Trust has grown twice as much among high-income individuals as low-income individuals.
- Women now trust financial services companies, with a score of 60 percent after a 4-point increase YOY. However, they are still less trusting than men, whose trust in the sector is at 63 percent.
- Younger generations have greater levels of trust in financial services than older respondents; individuals in the 18-34 age bracket are 9 points more trusting than those aged 55+.
- Despite a 4-point increase YOY, the investment management sub-sector remains in the “Neutral” category at 54 percent.
- Higher trust levels can be seen in the Middle East, Africa and Asia, yet trust challenges remain in major European economies such as France (29 percent trust; -5pts YOY), Germany (34 percent; 0pts YOY), UK (37 percent; -3pts YOY) and Italy (45 percent; +6pts YOY).
- Employees in the financial services sector are the second-most trusting of their employers; 84 percent trust their employer to do what is right.
- Business remains the only trusted institution (63 percent), in comparison to NGOs (59 percent), government (51 percent) and media (50 percent), and is seen as more competent and more ethical than government and media.
For more information about the Edelman Trust Barometer: Financial Services Edition, please connect with us on https://www.edelmansmithfield.com/contact-us.
About Edelman Smithfield
Edelman Smithfield is a global financial communications boutique that specializes in the financial markets and strategic situations. We are a top advisor for companies across industries in M&A, IPOs, investor relations, restructuring, and shareholder activism defense. We are also a trusted partner for financial markets companies as they seek to protect, promote, and evolve their reputation. Our purpose is to help clients solve complex issues, build trust, and enhance valuation.
About Edelman
Edelman is a global communications firm that partners with businesses and organizations to evolve, promote and protect their brands and reputations. Our 6,000 people in more than 60 offices deliver communications strategies that give our clients the confidence to lead and act with certainty, earning the trust of their stakeholders. Our honors include PRovoke's Global Agency of the Year (2022); Cannes Lions Grand Prix awards for PR (2016) and the Entertainment Lions for Sport (2021); a Gold Lion in the Sustainable Development Goals category (2022); Cannes Lions Independent Agency of the Year for the Entertainment Track (2021); Cannes Lions Co-Independent Agency of the Year for the Good Track (2022); and Advertising Age's 2019 A-List. Since our founding in 1952, we have remained an independent, family-run business. Edelman owns specialty companies Edelman Data x Intelligence (research, data), Edelman Smithfield (financial communications), Edelman Global Advisory (advisory), and United Entertainment Group (entertainment, sports, lifestyle).
About the Edelman Trust Barometer
The 2024 Edelman Trust Barometer is the firm’s 24th annual trust and credibility survey. The research was produced by the Edelman Trust Institute and consisted of 30-minute online interviews conducted between November 3 and November 22, 2023. The 2024 Edelman Trust Barometer online survey sampled more than 32,000 respondents across 28 countries. Published every January, the report covers a range of timely and important societal indicators of trust among business, media, government and NGOs, shaping conversation and setting the agenda for the year ahead. For more information, visit https://www.edelman.com/trust-barometer.