New survey reveals consumer expectations for digital banking

Findings from The New Digital Demand in Retail Banking report shows that banking today needs to be better integrated into customers’ digital lifestyle, providing service that is instant, integrated with social platforms, and most importantly, driven by data.

Oracle surveyed 5,200 respondents from 13 countries around the globe. The survey delved into four key customer banking stages with respect to digital: opening a bank account, payments and transfers, personal loans and mortgages, and personal finance management and investment services.

The vast majority of consumers have moved from the traditional ways of banking, such as visiting physical branches, to primarily banking online, and are increasingly open to trying new digital platforms.

• 81% of consumers are using digital channels to engage with their bank;

• 69% of respondents want their entire financial lifecycle on digital channels;

• Across all four banking stages, customers listed best rates or returns and experience as the most important considerations in today’s financial decisions;

• Consumers from India, China, Indonesia and Brazil ranked as the most open to trying new digital platforms, while the US fell in middle of the pack at seventh. This look at “digital openness” suggests that banks operating in mature developed economies must capitalize on the digital banking lifestyle to win over customers.

Trust, best rates or returns and experience are the top three most important factors for choosing a service provider. However, when consumers go into the banking lifecycle, the quality of rates and experience triumphs trust. The digital prowess of new non-bank options makes them an attractive alternative to traditional banks. As a result, banks are seeing an erosion in their core business.

• One-third of customers are looking for alternatives for personal loans and mortgages because of the unsatisfactory experience;

• More than 40% of customers think non-banks assist them best in their personal finance management and investment needs, indicating dissatisfaction with traditional banks in this area;

• 66% of customers say that experience is a major factor when choosing payment and transfer services, meaning consumer banks cannot afford to rest in this area;

• While customers between 20 and 52 prefer opening a bank account through digital channels, young consumers between 16-19 years old still prefer non-digital channels like physical branches, likely due to lack of experience, reminding banks of the importance of face-to-face assistance.

With customers perceiving fintechs and non-bank options favorably, attachment to traditional banks is decreasing. To retain their current customer base, banks need to deliver value, consistency in services and a higher standard of experience that meets the expectations of today’s customers.

• 30% of those who have not tried a non-bank product or platform before say they are open to trying them;

• Banks are highly trusted (65%) as a financial partner but are lacking in the other considerations, such as best rates or returns and benefits, which non-banks are highly associated with.

Lastly, cryptocurrencies topped the list when people were asked what non-bank alternative they have not used but are most keen to try, followed by independent online personal finance and/or wealth management apps, and independent digital-only fintech banks.