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Digital banking adoption in Singapore

Almost a third of Singaporeans will have a digital bank account by 2025.

Singapore is ahead of the curve when it comes to digital banking, according to a survey of 1,204 adults. The research reveals that one in five adults (20%) currently have an account with a branchless bank, equating to an estimated 980,000 people.

In addition to those Singaporeans who are currently with an online-only bank, 6% plan on opening an account in the next year and a further 4% intend on having an account in the next five years. All this means that almost a third of the adult population in Singapore will have a digital bank account by 2025.

While these numbers are encouraging for the growth of digital banking in the region, when asked whether they had a digital bank account, over two-fifths of the adult population (43%) said that they didn’t know what a digital-only bank was.

Singaporean women are more likely to have a digital bank account

It looks like Singaporean women are more curious about digital banking than men. Women are more likely to currently have a digital bank account, with approximately 24% of women holding an account versus 20% of men.

Women in Singapore are also more likely to be aware of the concept of digital-only banking than their male counterparts, with 38% of women saying they didn’t know what a digital bank was, versus almost half (45%) of the male population.

However, it looks like Singaporean men will close the digital banking gap in the coming years. 7% of men say they will open a branchless account in the next year versus 6% of women. The same goes for those planning to open a bank account in the next five years, with 4% men saying they’re going to open an account, compared to 3% of women. That means that by 2025, 34% of women are expected to have an online-only bank, compared to 30% of men.

Young adults are more likely to have a digital bank account

Singaporeans between the age of 18 and 24 are more likely to have a digital bank account, as a quarter (25%) are currently with a digital bank. Hot on their heels are those between the ages of 35 and 44. 24% of that cohort are currently digitally banked.

In the coming five years, it looks as if these two age groups will flip flop in regards to adoption of digital-only banking, with 11% of those aged 35-44 planning on opening an account in the next year and a further 4% planning on opening an account in the next five years. This means that roughly 40% of those in this age bracket will have an account in the next five years, compared to just 32% of those aged 18-24.

How does Singapore compare with the rest of the world?

Brazil and Germany have the biggest percentage of online-only bankers out of the 13 countries included in the study, with 28% of each adult population reporting that they bank digitally. India, Malaysia, Spain, Singapore and the Netherlands also have a large proportion of the population banking online, with around one in five adults currently holding neobank accounts.

Those in Italy are least likely to have an online-only bank account at just 12%, followed by France at 13%. Digital banking adoption is currently sitting at 15% in the Philippines, Mexico and Ireland and at 16% in Hong Kong.

Where is digital banking growing the fastest?

Over the next five years, India is set to experience the biggest boom in digital banking adoption, with a 21 percentage point increase in the number of adults with online-only bank accounts. This means that by 2025, we estimate that just under 400 million Indian adults will hold neobank accounts. Brazil, Malaysia and the Philippines are also expected to see significant growth, with an increase of 16 percentage points in each country, followed by Mexico and the Netherlands (15 percentage points each) and Germany and Hong Kong (12 percentage points each).

Spain, Italy and Singapore are expected to have a more modest, but still significant, increase of 10 percentage points, while the data suggests that Ireland and France will have the smallest increases, at 7 and 5 percentage points respectively.

Picture: Getty

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