In Singapore, fintech adoption among digitally active consumers rose to 23 per cent this year from 15 per cent in 2015, the report showed, but remained well below the average of 33 per cent among the 20 markets surveyed.

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Mr Liew Nam Soon, EY Asean Financial Services Managing Partner at Ernst & Young Advisory, said: “While fintech adoption levels in Singapore are lower than the global average, the groundwork has been laid and its anticipated penetration will increase across all categories in the next twelve months, with the highest growth expected from borrowing platforms and financial planning tools.”

“The lower adoption levels doesn’t mean that Singapore consumers are not open to fintech innovation. On the contrary, it reflects the efforts of traditional banks working with fintech start-ups, which gives consumers fewer reasons to go directly to the fintechs, unless it is a brand new innovation or value proposition,” he added.

Based on 22,000 online interviews with digitally active consumers across 20 markets, the report showed that emerging markets are driving much of the fintech adoption, with China, India, South Africa, Brazil and Mexico averaging 46 per cent. The other markets covered include Australia, Canada, Hong Kong, Singapore, the United Kingdom, the United States, France, Spain, Switzerland, Germany, Ireland, Japan, Netherlands, South Korea and Belgium/Luxembourg (considered as one market).

Not surprisingly, China has seen the highest adoption rates of fintech at 69 per cent, followed by India at 52 per cent. Fintech firms in these countries are particularly successful at tapping into the tech-literate but financially under-served segments, EY said.

Fintech adoption is set to increase in all 20 markets covered in the report. Based on consumers’ intention of future use, adoption could rise to an average of 52 per cent globally in the next several years, with Singapore among those showing the highest proportional increases of intended use.

FinTech adoption in Singapore is expected to increase to 56 per cent, largely driven by the Government’s effort to position the Republic as a top fintech hub and create a friendly regulatory environment, the report said.

Mr Liew said more consumers in Singapore will use fintech, not just the millennials but also the older generation, as awareness increases and users gain greater comfort in conducting financial transactions digitally.

“This is not surprising, given the vibrant fintech ecosystem – support from consumers, access to talent and capital, and governance. For financial institutions and fintech collaborations to be successful, fintech companies must be able to get access to customers and scale to build a sustainable business model,” he added.

The EY FinTech Adoption Index evaluates services offered by fintech organizations under five broad categories – money transfers and payments services, financial planning, savings and investments, borrowing and insurance.

It showed that money transfers and payments services continued to lead the fintech charge with global adoption standing at 50 per cent this year, based on the consumers that were surveyed. Some 88 per cent of global respondents said they anticipate using fintech for this purpose in the future. The new services that have contributed to this upsurge include online digital-only banks and mobile phone payment at checkout, the report said.

Insurance also made huge gains, moving from being one of the least commonly used fintech services in 2015 to the second most popular this year, now standing at 24 per cent. According to the report, this has largely been due to the expansion into technologies such as telematics and wearables (helping companies to better predict claim probability) and in particular, the inclusion and growth of premium comparison sites.