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High Street Banks Face Rising FX Customer Churn Challenge

High Street Banks Face Rising FX Customer Churn Challenge

(12 December 2022 – United Kingdom) British importers and exporters have never been more likely to shop around for both Spot FX and risk products execution new East & Partners research reveals, driven by both pricing and service incentives in addition to innovative new digital tools and platform features.

Small businesses in the United Kingdom (UK) who traditionally banked in a holistic way and opted not to “multibank” for FX due to administrative burdens, onboarding frustrations and a lack of resources to co-ordinate multiple accounts are now spreading their FX wallet across three to four providers on average according to East & Partners newly released December 2022 Business FX United Kingdom program. The analysis is based on direct interviews with 2,224 British CFOs and treasurers with active FX trading arrangements in place.

SME and Micro wallet share has fallen to record lows as custom retention becomes increasingly challenging, especially for leading incumbent bank majors ranked in the report including High Street, domestic and international groups such as HSBC, Barclays, Lloyds, Citi, JPMorgan and Santander.

“Curtailing damaging wallet share losses remains the most pressing concern for both incumbent Banks and non-bank FX providers alike” commented East & Partners Global Head of Markets Analysis, Martin Smith.

“We are also observing UK corporates actively divert hedging activity away from FX Options to Forward FX, seeking greater flexibility in the event currency volatility exceeds expectations. Corporates are increasingly turning to their FX provider for guidance to navigate mounting headwinds including rising inflation, interest rates and energy prices all combining to weigh on economic growth, raising concerns of a global economic recession” Smith added.

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