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Digital banking adoption
Branchless banks are more common than you may think.
Have you ever thought about doing away with your traditional bank account and opting for a purely online option? While branchless banking is not the norm yet by far, it’s becoming increasingly popular with approximately 9% of Canadians saying they have an online-only bank account, according to the latest survey conducted by Finder.com.
While 9% may not seem like a lot of people, this equates to more than 2.9 million Canadians who bank online, with a further 4% (or roughly 1.3 million Canadians) planning to open an online-only account in the next year and another 3% (771,985 adults) to open an account in the next five years. This means that by 2026, 16% (almost 5 million Canadians) will have a digital-only account.
However, the bulk of Canadians are still in the dark about branchless banks, with 56% saying they don’t know what a digital-only bank is.
Women are slightly more likely to have a digital-only bank account than men
When it comes to gender, women have a slight edge over men when it comes to exclusively online accounts with 9% of women saying they have an account compared to 7% of men. While the number of men and women with digital accounts is expected to grow in the coming years, the gap is expected to remain the same, with 15% of women to have an account by 2026 and 13% of men.
Digital-only banking adoption most popular with 25-34-year-olds
People aged 25 to 34 lead the way for branchless banking, with 13% saying they have an account. Tied for second are 18 to 24-year-olds and over 65s, with 7% having an account.
Which country has the most digital bankers?
Brazil has the most digital bankers (32%), followed by Indonesia and Ireland (25% each), Vietnam (23%), and Switzerland and Poland (22% each). On the other end of the spectrum, the United States has the smallest percentage of adults with a digital only bank account (6%), followed by Canada (9%), Finland, Denmark and Mexico (11% each).
Mexico is expected to have the strongest growth in the number of people with digital only bank accounts from 2021 to 2026 – an increase of 21 percentage points. Brazil, Vietnam, Malaysia and the Philippines are all expected to see a growth of 18 percentage points.
Did digital banks lose customers as a result of COVID-19?
Of the 30 countries Finder looked at for this study, Finder had previously run the same survey in 12 of those nations and regions in 2020. Interestingly, 6 out of those 12 countries saw a drop in the number of adults who said they had a digital only bank account.
Germany had the largest drop of 9 percentage points. The Netherlands saw the second-biggest drop of 7 percentage points, while Spain and Mexico closely followed at 6 and 4 percentage points, respectively. Meanwhile, countries like Singapore and Malaysia saw smaller drops of 2 percentage points and less than 1 percentage point, respectively. Bucking the trend, Ireland actually had an extra 10 percentage points of adults with a digital bank account in 2021 compared to 2020, and Brazil had an extra 5 percentage points.
However, all countries are expected to see an increase again by 2026. On average, 28% of people worldwide will have a digital bank account within the next 5 years, up from an average of just 17% in 2021.
Mexico is set to see the biggest growth in digital bankers, with an additional 20% of Mexican adults planning to take out a digital bank account by 2026. The number of digital bankers in Brazil and Vietnam is also set to skyrocket, with an additional 18 percentage points of people set to open a wholly digital account in each country.
Meanwhile, digital banking adoption is moving at a slower pace in countries like France, Japan and the US, with 5% or less of the adult population in these countries expected to take out an account over the next few years.
Are men or women more likely to have a digital only bank account?
In 19 of the 30 countries surveyed, men are more likely to have a digital only bank account. Of these, the United Arab Emirates, Brazil, Finland and Japan had the biggest gender gaps of 8 percentage points each.
Meanwhile, in 9 countries, women are actually more likely to have an online-only bank account. Australia has a female-led gap of 3 percentage points, and Ireland and Canada both have a gap of 2 percentage points.
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