Older generation missing out on online banking, money saving

Older generation missing out on online banking, money saving

Older people are missing out on billions of pounds of savings by not using computer technology to its full potential, according to research.

Written by Trevor Lloyd-Jones on 20 April 2012

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The Payments Council is trying to persuade more over-65s to use the Internet for payments and shopping by helping them to overcome concerns over security and identity theft.

For its latest research, the body which sets the UK standards for cheques and electronic payments, conducted 4,000 face to face interviews on how people use their gadgets, as part of its Pay Your Way education campaign.

The results show that over-65s in the UK have spent a huge £2.5 billion on computer equipment, yet over two thirds (68%) admit they aren't taking advantage of its potential.

Nearly half of them (44%) now have access to a computing device, with this age group having spent an average of £622 each on smartphones, laptops, desktop computers and tablets. The majority of this online older generation are comfortable using their gadgets to surf the web (70%) or send and receive emails (67%), yet many are failing to take full advantage of their investment in technology.

Under a third (32%) of over-65s with computer access use Internet banking and only 38% shop online. And there is a big generation gap when it comes to making the most of technology as twice as many 25 to 34 year-olds (64%) use Internet banking, or shop online (68%).

Comedian and TV historian, Tony Robinson, who is supporting the Pay Your Way campaign to raise awareness of using the web, said: "The Internet is a wonderful tool and it can be a real asset to older people who might benefit from being able to do things from the comfort of their own home. Internet banking allows you to keep on top of your money matters."

Welsh spend the most on the web

The research uncovered some regional variations in the way people use the Internet. The highest percentage of adults not making the most of their gadgets was in the East Midlands, where 89% of over 65s admitted to not taking full advantage of their computers.

Over 65s in Wales have invested the most in computing devices, with the average spend being £810. The lowest percentage of older adults using their computers for Internet banking is in North West and in Wales (21%). Older adults in the North West are the most worried about the security of online banking, with 51% citing this as a reason for not managing their finances online.

Interestingly, when older people do use the Internet, they are quite likely to use social networking sites like Facebook to find old friends and colleagues. Over a fifth of over-65s use their gadgets to play games, 15% use social networks and 17 per cent watch iPlayer on their computers (around half the number that use Internet banking).

Encouraging Silver Surfers

There are some other signs that older people are starting to take advantage of Internet banking in greater numbers. Roughly half of adults aged 50 and over have been contacted by someone from their past through a social network, according to the Pew Research Center. As people retire or change careers, social networks can be a way to stay in touch or get support.

Internet users with chronic diseases are more likely to blog or participate in online discussions, and older people are more likely to have these diseases. Another major reason for older people to use social networks is to connect with their adult children. Put those factors together, and there are more and more reasons for older people to use social networking to find communities of people with similar experiences.

The social changes are recently starting to show and over one in five (22%) over-65s who bank online only started using it in the last two years. As part of Silver Surfers' Day, which is helping older generations to get online, the Payments Council is encouraging older adults to make the most of the untapped technology, including considering the benefits of Internet banking.

Security worries

Worries about security are a key factor behind the reluctance to manage finances online, with 39% of over-65s citing this as their reason for not using Internet banking.

Commenting for Pay Your Way, Adrian Kamellard, CEO of the Payments Council said: "People from every generation are now familiar with the benefits of surfing the web and sending emails, yet many of us aren't using the computers we own to their full potential. Banking online is a safe, straightforward way to free up your time to do the more enjoyable things in life, whether that means going on Facebook or meeting friends in the real world."

The Pay Your Way website at www.payyourway.org.uk has useful information on using different types of payments and new technology such as contactless cards, mobile payments and apps for banking.

How to stay safe online

Anyone who is concerned about their online safety should follow some golden rules about using the Internet:

  • Keep your PC protected by using the latest browser and operating system, and making sure your anti-virus software is up to date.
  • Look for the padlock when buying things online. The padlock icon shown at the top of the screen shows you are using a secure payment page.
  • Register your cards with the security schemes offered.  Verified by Visa, MasterCard SecureCode and American Express SafeKey offer an additional layer of protection.
  • Always log out from a webpage after shopping, and make sure you print or save a copy of the order in case you have any problems with it.

Further help and information on using Internet banking and on financial planning are available on MoneyVista. If you're new to MoneyVista, click on 'Build my plan' to get started.

For registered users MoneyVista allows you to analyse all your accounts, pensions and other assets in one place and see what they would produce in retirement. You can set your budgets and goals for the year ahead. To get started you can access the MoneyVista guides to Paying bills and Making the most of your credit card   

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