Friday 11 January 2019, LONDON – At least a quarter (24%) of Brits will have an account with a digital-only bank within the next five years, according to new research from personal finance comparison website finder.com.
A further 21 percent said they would consider a digital-only bank once they have more information, meaning that almost half of Brits (46%) could end up getting an account within five years.
One year on since Open Banking launched in the UK, almost one in ten (9%) adults say they have already opened an account with a digital challenger bank, equalling 4.5 million Brits.
Over the next five years, 16 percent of the population intend to open an account with a digital-only bank, meaning that almost 13 million people (24%) will have at least one fully digital account by the end of 2023.
The top reason for those who have, or intend to go digital with their banking is that they feel doing everything online is more convenient (33%). A third (31%) of people believe they will get better rates than with traditional banks, while 28 percent want to transfer money more easily.
Despite the quick uptake of digital banking in a short amount of time, finder.com’s research shows that as well as some educational challenges and issues around awareness, digital banking simply may not be for everyone. The majority of adults in the UK (53%) have no plans to open an account within the next five years, while one in five Brits (20%) don’t know what a digital-only bank is.
Perhaps surprisingly, the main reason for those who don’t intend to open an account with a digital bank is that they feel their current bank has treated them well (61%). Half of us (49%) also like to have the option of speaking to someone in person, while more than one in five (22%) think it would be too much hassle to switch accounts and direct debits.
The region with the lowest uptake so far is the East Midlands, where only five percent of people have a digital-only bank account. In contrast to this, Londoners are almost three times as likely to have one (14%), and they are also the most likely to get an account within the next five years with a quarter (26%) planning to do so. East Anglians are the least likely to move away from traditional banks (12%) over the next five years.
Despite the uptake of digital banking being very similar across genders so far, a fifth (21%) of men intend to get a digital-only bank account in the next five years, which is significantly more than women (12%).
Younger generations are the most likely to have already gone digital, with one in eight (12%) Millennials having done so, compared to six percent of baby boomers and just two percent of the silent generation (born before 1945).