Consumers to move to digital-only banks this year

Pure-play digital banks are more likely to offer high quality mobile and online services, according to Intelligent Environments survey

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One in eight (13 percent) of UK consumers say they intend switching their bank account to a digital-only provider this year. Several providers are set to launch services in the UK this year, including Atom, Fidor and Starling.

An online poll of 2,000 Brits was commissioned by financial services technology provider Intelligent Environments. The survey revealed that over a third of consumers (34 percent) thought that within five years more people would have an account with a digital-only bank rather than with a traditional provider.

The research indicates that many consumers feel more confident about digital-only banks too, in part due to the increasing importance of mobile and digital banking, with 60 percent of respondents saying mobile and digital banking services are “very important to them”. Almost a third (31 percent) believe that a digital-only bank would offer better mobile and digital banking services than a traditional bank.

Additionally, 14 percent said they would trust a digital-only bank more than a traditional bank, and 16 percent believe digital-only banks will have fewer security problems than their traditional counterparts.

However, not all are so confident in digital-only banks. The research also showed that more than half (52 percent) of UK banking customers don’t like the idea of not being able to speak to someone in person if they have a problem, along with 44 percent claiming they wouldn’t switch because in branch services are important to them.

David Webber, managing director of Intelligent Environments, said: “Digital-only banks are in a strong position to cause major disruption to traditional providers when they launch in the UK later this year. Our research shows people believe these new providers will offer superior online and mobile services.

“When taken together with the lower operating and efficiency costs naturally incurred by not having any branches, digital-only banks will be in a very competitive position indeed.”

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