Data security concerns makes over 55s reluctant to go online

Older borrowers could be missing out on the best mortgage and equity release deals through fears about the security of their data, according to recent research from RegTech firm Contact State.

Data Control Matters, Contact State’s inaugural report, has released figures which depict consumer data shared online, and found that just 9% of over 55s went online to get their last mortgage or equity release quote – compared to 17% overall – and two-thirds (63%) went with the first quote they received.

Thomas Brett, head of mortgages and lending at Contact State said that the data reveals the challenges and the opportunities for brokers within the later lending market: “Our findings suggest that concerns about data are creating a real disconnect between over 55s and mortgage and equity release brokers who rely on online channels for their leads. And it seems those concerns are well justified, given so many older borrowers have had negative experiences, particularly when filling in a form or calculator online, and expecting to get a quote from one company, and then finding they are being called by someone else.”

He continues: “The trouble is, these online forms and calculators are how so many mortgage and ER brokers get their leads, and if over 55s are having negative experiences using them, they are much less likely to buy when they do eventually get put in touch with someone who can help.”

Data Control Matters shows that while just 9% of over 55s got their last mortgage online, 31% would start their search online next time, and this, says Thomas, means there is a huge opportunity for brokers to win new business but warns that those getting it wrong could find themselves on the wrong side of the FCA. “There are clear opportunities here, but if brokers are buying data or leads from a source they don't understand, and the customer has had a negative experience getting to them, not only are they less likely to buy but as the buyer of that lead, the mortgage firm/broker could well be in breach of the Consumer Duty”, he concluded.

Online jitters

Contact State’s research of 5,000 UK adults suggests that one of the key factors in over 55s’ reluctance to compare deals online is concerns about who has access to their data once they do. Overall, three-fifths (62%) of over 55s say they have reservations about sharing personal and financial details online to get a mortgage quote, including 30% of over 55s who have hesitations when it comes to sharing a phone number.

Consequentially, this is perhaps understandable when you consider that 73% of over 55s have been targeted by cold callers over the past year – almost half of these (30%) have been contacted more than 10 times. For 58% of over 55s, receiving cold calls left them feeling agitated – especially given that most (63%) say they have no idea how the caller got their number.

Furthermore, one in seven (15%) of over 55s feel they have been forced to share their data online when looking for a financial product such as mortgage or insurance, and 52% said that when they do share their data online, they are not confident they know who has access to it.

One in eight (13%) over 55s have had a ‘negative experience’ when getting a financial product or professional service online, and again, the key issue in relation to this is unwanted phone calls, specifically, ‘being contacted by a company other than the one I submitted my details to’.

This particular issue is of huge concern to older borrowers with 84% of whom say they’d be unhappy if they submitted their details to one company, and were called by another, while 96% said they would be worried about the security of their data if this occurred.

Other online concerns

Additional online fears include a financial product or service pages not being clear enough, with just over one in five (22%) over 55s recalling a negative experience when getting a quote and said, ‘I wanted an online quote but was called instead’, while 19% said ‘it was unclear that I would have to submit details to receive a quote.

It is perhaps unsurprising that 39% of over 55s are less willing to share their data online than they were five years ago, and despite the significant shift to the cyber sphere, more than two-thirds (69%) would still refuse to go online if they wanted to re-mortgage now.

Commenting on the findings, Desmond O'Hara, adviser development manager at Access Equity Release said: “Lead gen is vital to the equity release market but Contact State’s research has revealed that older consumers are increasingly being misled into giving their details, and if that ER lead is not genuine it creates a negative experience for the consumer and the provider.  “At Access Equity Release, there is almost nothing that can be more important than the authenticity of a client’s enquiry and the security we place on that client’s personal information, so we welcome the work Contact State is doing to certify the good leads because ultimately, it is safer for the customers, more profitable for the lead buyer, and better for the industry as a whole.”

Alain Desmier, managing director of Contact State concludes: “Our research highlights just how serious the issues around data and consent are, and the negative impact it is having on people,” he said. “At Contact State, we are working hard with lead generation buyers and sellers across the UK to clean up the industry, creating a clear and transparent customer journey so firms know exactly how that customers’ number was obtained to help ensure ‘how did you get my number’ becomes a question of the past.”

The consumer research was carried out by Opinium Research between 4-12 July among 5,000 UK adults weighted to be nationally representative.

To find out how Contact State can help you protect your business, buy better leads and save money, visit https://www.contactstate.com/