British consumers could save up to £24.5bn collectively if they adopted digital financial management tools, research by Tink has found.

The payment services firm’s findings revealed that those who use these tools are on average £27.08 better off per month, or £445 per year, compared to pre-adoption.

With 7.6 million UK consumers using these tools, as a group, they are gaining up to £3.38bn collectively per year. If widened out to every person in the UK over the age of 16 using these tools, Tink said this could represent the equivalent of a potential extra £24.5bn going into the group wallet each year.

The research of 2,010 UK consumers comes as an estimated 75% said they are mindful about what they are buying because the cost of goods is so high.

When asked about their personal finance goals for the year ahead, almost half of consumers surveyed said they wanted to build savings pots (49%), while more than a quarter wanted to cut off unnecessary expenses (27%) or build an emergency fund (26%).

Tink said it is therefore "no surprise" that consumers are using the money saved through digital financial management tools to work towards these personal finance goals.

Thirty-nine per cent of those surveyed used the extra funds to increase their savings contributions and 23% paid down their debt.

Tink added that banks seeking a competitive edge have an opportunity to capitalise on "clear consumer demand" for these tools.

Over a third (36%) of respondents said they would switch to another bank if it provided them with tailored support to meet their financial goals, while 32% would switch if it provided them with tools to track and manage their spending.

Banking and lending director for UK and Ireland at Tink, Jack Spiers, said: "It’s clear that financial management tools can make a material difference to a consumer's finances. In addition to improved financial health, our research shows consumers have also reported a wide range of wellbeing and lifestyle benefits. These vary from reduced stress levels to increased happiness, as well as less time spent on managing money.

"At the same time, there are clear advantages to banks offering these tools to their customers. In a competitive retail banking market, banks have an opportunity to differentiate their offer and meet evolving consumer expectations by helping their customers better manage their finances."

---