New research from Intelligent Environments shows that one in eight Brits plans to switch their current account from a traditional to a digital-only bank when the likes of Atom and Starling launch in the UK later this year. Additionally, one in three believes digital-only bank accounts will outnumber traditional ones within five years.

An online poll of 2,000 Brits indicates that many feel more confident about this brave new world, in part due to the increasing importance of mobile and digital banking. 60 per cent of respondents said mobile and digital banking services are very important to them, and 31 per cent believe that a digital-only bank would offer better mobile and digital banking services than a traditional counterpart. Additionally, 14 per cent say they would trust these newcomers more than a traditional bank, and 16 per cent believe they will have fewer security problems than the retail banking establishment.

At the same time, however, 52 per cent don’t like the idea of not being able to speak to someone in person if they have a problem, along with 44 per cent claiming that they wouldn’t switch because in branch services are important to them. David Webber, managing director at Intelligent Environments, says: “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. However, digital-only banks do not spell the end for traditional branches. As our research shows, many of the UK’s banking customers still like the personal touch. In-branch services are still highly valued by a significant proportion of the population, while others have voiced concerns about not being able to speak to a customer service representative in person if they had a problem. In fact, traditional providers have a fantastic opportunity now to improve their digital and mobile services, and to focus on providing a superior in-branch experience for customers."

He adds: “What is certain is that the introduction of digital-only banks will shake up the personal banking sector. Whether or not digital-only banks outstrip traditional providers within the next five years isn’t nearly as important as the benefits consumers will experience as a result of their introduction. More competition, more choice and an increased focus on mobile and banking services guarantee that digital-only banks entering the UK market will be a big win for consumers.”

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