Brits save £400 a year by cancelling subscriptions – but still lose £61 to the ‘direct debit trap’, HSBC UK
- Consumers are saving an average of £34 a month – over £400 a year – by cancelling subscriptions.
- Yet the convenience of direct debits still costs them £61 a year on services they no longer use.
- Nearly half of people (48%) admit the convenience of automatic payments. This convenience means they pay for unwanted subscriptions for longer than they should.
- 95% of people say they would find it helpful. They would like their banking app to clearly show all their subscriptions in one place.
New research from HSBC UK reveals that Brits are actively cutting back on subscription services. Yet, many are still losing money to ‘invisible spending’. This often occurs through automatic payments they forget to cancel.
The survey of 2,000 UK adults was released as part of HSBC UK’s Invisible Spending campaign. It found that people are saving an average of £34 a month (£408 a year) by cancelling subscriptions. The most axed services include streaming platforms (51%), music services (30%) and delivery memberships like Amazon Prime (29%).
Convenience comes at a cost.
The average person is still wasting £61 annually on services they no longer use. This happens simply because they haven’t cancelled them. Almost half (48%) say the ease of direct debits leads to delayed cancellations. Meanwhile, 43% admit to keeping subscriptions “just in case they might use them again.” A further 29% say ‘fear of missing out’ prevents them from cancelling.
Millennial’s feel the pinch most
Millennials (aged 29-44) are the most affected, both in savings and wasted spend. They’re cancelling more subscriptions than any other group –saving £37 a month – but also wasting the most, at £69 a year. They’re also the generation most likely to feel caught out by automated payments, with 54% saying direct debits delay their decision to cancel.
Impulse spending undermines efforts to save
While people are consciously cutting back on recurring costs, many struggle to stay disciplined in other areas. Over six in ten (62%) Brits admit they often make impulse purchases. The figure rises to 71% among Gen Z and Millennials. Boredom (44%) and day-to-day stress (41%) are the top triggers.
The need for better oversight
This battle between planned saving and spontaneous spending highlights a clear demand for better financial management tools. An overwhelming 95% of people expressed their desire for clarity in their banking app. They would find it helpful if it clearly showed all their subscriptions in one place.
Sabine Fichaux, Head of Transactional Banking at HSBC UK said: “Subscription services have made life more convenient – but they’ve also made it easier to lose track of what we’re paying for. Our research shows that people want clarity and control, whilst still budgeting for the things that matter to them.
“At HSBC UK, we’re committed to delivering that clarity to our customers. HSBC UK’s newly redesigned mobile banking app offers customers a variety of financial tools for spending and budgeting insights, including the ability to see upcoming payments and subscriptions, easily being able to cancel them if that is wanted.”
“Alongside subscription management, we also offer a range of savings products designed to help people build better habits, from flexible options like the Bonus Saver to longer-term products such as the Fixed Rate Saver and Cash ISA.”
