Press Release

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Over 70s forced to turn to digital-only banking following local bank branch closures

  • 16% of UK adults (8.5 million) opened or plan to open a digital-only bank account due to traditional bank branch closures in their local area.
  • Over half of the silent generation (53%) have moved or intend to move to digital-only banking for this reason.
  • 12.6 million Brits (24%) currently have an account with a digital-only bank and almost 1 in 5 (19%) said they intend to open one within the next five years.
  • A third (32%) have no intention of opening an account with a digital-only bank.

16, February, 2023, LONDON

A quarter of Brits (24%) say they have a digital-only bank account in the 5th annual digital banking adoption research from the personal finance comparison site, finder.com.

In the first survey back in 2019, just 9% of the population said they had a digital-only account, so the current figure is 3 times that amount.

Over the next 5 years, 19% of the population (10 million Brits) said they plan to open a digital-only bank account, and 10% are planning to do so within the next 12 months. This means that by 2028, 22.7 million Brits (43%) could have a digital-only bank account.

Traditional branch closures are forcing older generations to turn to digital-only banking

16% of UK adults (8.5 million) claim they have opened, or intend to open, a digital-only bank account due to a lack of bank branches in their local area.

Of those in the silent generation (aged 74+) who said they have already, or plan to, open a digital-only bank account, 53% claimed that this was a reason for doing so, highlighting the impact of physical bank closures on the older generation. In fact, the number of those in the silent generation with an online-only account has almost doubled from 7% in 2022 to 13% now.

15% of baby boomers (aged 55-73) claim to have opened an account or were planning to do so due to local branch closures, and 22% of gen X. On the other end of the spectrum, only 9% of gen Z cited this reason for opening or planning to open a digital-only account.

Convenience is key when selecting a digital-only bank account

The research asked why participants opened or intend to open a digital-only bank account, and the majority (64%) of answers were linked to convenience.

22% of Brits claimed that they were already looking to open a new account and digital seemed to be the easiest option, whilst a further 21% said that they wanted to be able to transfer money more easily and another 21% claimed that using a digital-only bank is generally more convenient.

Other popular reasons for switching included gaining access to better rates (20%), wanting free transactions abroad (18%) and the capability to trade stocks and cryptocurrency with their digital-only bank account (12%).

Loyalty to traditional banks is still a crucial retaining factor

Of those who claimed to need more information before considering opening a digital-only bank, or don’t intend to open one at all in the near future, a significant 50% said that the fact that their current bank has always treated them well was a key reason for them not switching.

34% of Brits prefer to have the option to speak with someone in person, which could help explain why a lack of physical bank branches in the local area is such a popular reason for individuals switching to neobanks.

Almost a quarter (24%) claim that the reason they haven’t switched is because they don’t trust digital-only banks. A further 19% claim it’s too much hassle to move from their current bank to a digital-only bank, and 17% said it was too much hassle to open a new account.

To see the research in full visit: https://www.finder.com/uk/digital-banking-statistics

Commenting on the findings, Kate Anderson, banking expert at finder.com, said:

“This year, we can really see the impact that high-street branch closures are having on the banking market, particularly for the older generations. The fact that such a significant proportion of the silent generation have opened a neobank account due to the closure of physical branches suggests that the wind could finally be changing when it comes to older generations avoiding digital-only banking.

It’s clear that digital-only banks are doing everything they can to appeal to these demographics, including making the process of owning a digital account easier than ever. In fact, it was a digital-only bank (Starling) that won the Finder Banking Customer Satisfaction Award this year, with customers citing the ease of opening and efficiency of managing an account as some of their favourite features.

Despite the many benefits of digital banking, one clear blocker is the value Brits place on being able to talk to someone in person. The fact that so many claim that they do not trust digital-only banks is also a big problem that needs to be addressed in 2023 if these neobanks want to keep progressing in the market.”

Methodology:

Finder commissioned Censuswide on 12/22 to carry out a nationally representative survey of adults aged 18+. A total of 2,000 people were questioned throughout Great Britain, with representative quotas for gender, age and region

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Disclaimer

The information in this release is accurate as of the date published, but rates, fees and other product features may have changed. Please see updated product information on finder.com's review pages for the current correct values.

About finder.com

finder.com is a personal finance website, which helps consumers compare products online so they can make better informed decisions. Consumers can visit the website to compare utilities, mortgages, credit cards, insurance products, shopping voucher codes, and so much more before choosing the option that best suits their needs.

Best of all, finder.com is completely free to use. We’re not a bank or insurer, nor are we owned by one, and we are not a product issuer or a credit provider. We’re not affiliated with any one institution or outlet, so it’s genuine advice from a team of experts who care about helping you find better.

finder.com launched in the UK in February 2017 and is privately owned and self-funded by two Australian entrepreneurs – Fred Schebesta and Frank Restuccia – who successfully grew finder.com.au to be Australia's most visited personal finance website (Source: Experian Hitwise).

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