Half of Millennials switch for digital banking
Written by Peter Walker
There is a growing willingness amongst Millennials to switch banking providers in pursuit of better digital experiences, according to research from MuleSoft.
The application network platform surveyed more than 9,000 consumers, finding that almost half (49 per cent) of consumers aged 18 to 34 said they have switched or considered switching banks in the last 12 months in order to receive a better digital experience.
This compares to an overall global average of 27 per cent, indicating that the appetite for digital experiences is generational.
More than a quarter (27 per cent) of consumers said they have replaced or considered replacing their traditional banking provider with an online or mobile-only banking provider – a figure which climbs to almost half (46 per cent) amongst 18 to 34 year-olds.
Of the customers who have switched or considered switching banks, dissatisfaction with their current provider (42 per cent), ease of opening an account (29 per cent) and wanting a better mobile experience (24 per cent) emerged as the top factors.
The report revealed that the use of Open Banking services is becoming more common, with 39 per cent of respondents stating that they have used an app to view bank balances or transactions from multiple accounts held with different banks or other financial services providers.
Nearly half (46 per cent) of consumers said they would be willing for financial services providers to share their relevant personal information if it meant they receive a more personalised experience.
Although again, this varies by generation: 61 per cent of 18 to 34 year-olds would be willing for their data to be shared for personalisation, compared to just 32 per cent of consumers aged over 55.
“Personalised experiences are highly valued among consumers, and consumers are willing to share more information to receive better services,” said Danny Healy, a regional executive at MuleSoft. “This willingness is paving the way for Open Banking to truly take off, but many banks have yet to fully embrace the opportunities that are available to them.”
The survey showed that financial services providers continue to struggle to provide a connected experience – unable to fully understand a customer’s preferences across all channels or provider access to the information they need within a timely manner.
More than half (57 per cent) of consumers revealed they would consider changing financial services providers due to a disconnected experience. Geographically, those in the UK (60 per cent) were the most likely to take their business elsewhere.
Consumers cited applying for a mortgage as the most complicated (43 per cent) and time-consuming (82 per cent) task when engaging with a financial services provider. This was closely followed by applying for a loan, which 36 per cent cited as complicated and 67 per cent said was time-consuming.
The survey was carried out by Opinium Research in August among 9,030 adults – 2,002 of which were in the UK.