Studying Financial Services for Newcomers to Canada – 2018
Having a healthy economy is key to the prosperity of any country. Immigration has historically been one of Canada’s important pathways to economic growth, and now, more than ever, it is a vital part of our continued development as a country. For the financial services sector in general, and banking in particular, newcomers to Canada represent a strategic group with whom leading financial brands can gain market share.
Immigration last year accounted for two-thirds of Canada’s population growth of 1.2%. A large proportion of these newcomers were aged under 44, from mass affluent backgrounds, and predominantly from Asia, helping to boost Canada’s economy both through housing and enrolment in education. According to Statistics Canada in 2016, almost half (48.1%) of the foreign-born population in Canada was born in Asia. Additionally, it is predicted that by 2036, that immigrants could represent 24% to 30% of the Canadian population, and between 55.7% and 57.9% of Canada’s immigrants could also be born in Asia.
It is this segment of Newcomers to Canada from Asian backgrounds that is of particular interest to Canada’s financial brands and which forms the focal point for DALBAR’s upcoming Newcomers Study.
Commissioned by DALBAR Canada, this syndicated study comes in response to the need for more retail banking performance measures for the ever-growing demographic of Newcomers to Canada. The purpose is to identify the latest trends and best practices in the retail branch experience for Newcomers, focusing on those from mass affluent backgrounds.
Newcomers fall into two categories, landed immigrants and international students. The common thread among all Newcomers is that they are deemed mass affluent with at least $250,000 in investable assets (either of their own or from their sponsoring family), and all have been in Canada for less than 2 years.
Previous studies have also highlighted the growing trend in landed immigrants, and international students coming to Canada.
A 2014 study by DALBAR investigated this surge in interest in new immigrants by Canadian banks, and addressed the need for improved media advertising to make themselves known to these Newcomers. The study contrasted this development to 10 years ago when there were no specialized accounts for new immigrants, nor specialized features in a client’s native language.
Fast forward to today, where competition between Canada’s largest financial institutions is fierce as they aggressively race to obtain the assets, business and loyalty of Newcomers, specifically those immigrants coming from Asia.
The current study utilizes data obtained via mystery shop as this is the most accurate method to measure the client experience at a financial institution. In total, 42 mystery shops will be performed, spanning 7 banking institutions: BMO, CIBC, HSBC, National Bank, RBC, Scotiabank and TD, all in the Greater Toronto Area.
The key areas of measurement in the study include: applying for a credit card, international fund transfers, and mortgage application inquiries. A detailed report will be compiled and provided alongside collateral material samples that were provided to the customer.
As with DALBAR’s 2014 study, the objective of this study is to provide a snapshot of banking services for Newcomers to Canada as well as to report on what has changed since then, including identifying possible trends or best practices as well as opportunities in servicing this increasingly influential segment of the Canadian population.
To order a copy of this report, contact Anita Lo directly at AnitaLo@DALBAR.com.