41% of UK consumers are considering a switch to digital-only banking, with Millennials leading the charge
The UK is ripe for a proliferation of digital banking offerings, according to a survey of UK consumers by Marqeta, whose advanced payments infrastructure and open-API platform has pioneered a new standard for Modern Card Issuing. A significant proportion of respondents (41%) admitted to considering the switch to a digital-only banking service, evidence that the global shift from traditional to internet banking is even more accelerated in the UK.
This attitude stems in part in the belief that hard cash will soon become obsolete. Most respondents (55%) think that cash will disappear from use altogether, with 72% of this group indicating this could be in the next 20 years.
As cash use decreases, greater importance is being placed on the need for simple-to-use technology. When UK consumers were inspired to list the most important benefits their bank provided 3 times as many people listed a user-friendly mobile application (27%) than an in-person presence (9%). This puts the united kingdom ahead of the US market where just 21% believe an easy-to-use mobile app is their best benefit, versus 15% who prefer an in-person presence. UK consumers were also 60 percent less likely to have written a cheque in the last month than US consumers for something apart from utilities or rent (13% v 32%).
Significantly, UK consumers were more reluctant in general about the idea of changing to a bank operated by Facebook, Amazon or Google, with 37% of respondents prepared to consider a change, versus 46% people respondents.
The transition to a completely cashless society would also cause a security concern among 65% of UK respondents. Regardless of this, fears regarding the security of digital services like mobile wallets drops to 39% among all respondents.
Millennials (18-34 year olds) represented the group most comfortable exploring the benefits of digital banking. Marqeta's research discovered that Millennials were:
- More than three times more likely than a Baby Boomer (51-65 years old) to have completed a purchase using a mobile wallet (51% v 16%).
- Almost twice as likely than a Baby Boomer to convey comfort using TouchID and FaceID to authorise a payment (52% v 29%).
- More than two times as likely than a Baby Boomer to pay for someone back using a peer-to-peer banking service than cash or check (44% v 21%).
- Five times more prone to use Apple Pay (25% v 5%) and four times more likely to use Google Pay (20% v 4%) than a Baby Boomer.
Commenting on the survey findings, Marqeta's Head of European Growth, Ian Johnson, said: “Driven by younger generations, consumer preferences in the united kingdom are rapidly evolving toward new payment touchpoints and digital banking tools as people are starting to engage with an increasingly mobile and try to connected economy in entirely new ways. As digitally native consumers start making a considerable part of the population base, this speed of innovation will simply increase and the winners in the financial technology space will be those who can bring products to promote that can get ahead of this rate of change.”
The survey of 2,027 consumers across the US, UK, France, Germany, and Spain, was completed by market research firm Propeller Insights with respect to Marqeta.