Quarter of people don’t plan to visit a bank branch again

One in four people are unlikely to ever set foot in a bank branch again, preferring a 100% digital experience, according to a global survey.

The survey also revealed that customers are content with digital banking services and are willing to share their personal data in exchange for personalised services.

Over a quarter (26%) of banking customers will replace branch visits with digital services, while about 19% will use a blend of the two, according to the survey of 10,000 people, which included 1,000 UK respondents, carried out by 3Gem for software company SAS.

The Covid-19 pandemic has been the major catalyst in the acceleration of the take-up of digital banking channels. During the health crisis, bank branches closed, forcing people to use alternative methods of banking. Over 12% of users of digital banking services used them for the first time during the pandemic.

Banks responded to the pandemic by investing further in tech to expand their digital service offering, while cutting costs through branch closures. Although banks have been shuttering branches for several years to reduce costs, the migration of customers to online banking during the pandemic is being used as justification for more closures. This year alone, thousands of branches have been closed across Europe.

According to the study, despite branch closures and reduced access, customer service levels have not been hugely affected. It found that only 15% of respondents felt customer experience had worsened during the pandemic, while 14.5% said customer service had been faster and more efficient.

This is the result of investments in tech. “Digital banking may be a mature industry in the UK, but banks have delivered significant improvements in customer experience over the past year and a half,” according to the research.

Customers cited more targeted and frequent offers among the reasons for improved service levels, and over 20.7% said it was now quicker and easier to make purchases online.

But UK banks need to continue to offer high digital service levels or risk customers jumping ship. The survey found that in all sectors, over 50% of UK customers would change provider after just one or two bad experiences.

The next big shift in digital banking could be increased willingness of customers to share their data. Now that people have become more comfortable with digital banking they are beginning to understand the benefits of sharing their personal data with organisations.

The survey found that almost 12% of participants said they would be willing to share data if it meant better customer experience, such as faster and easier transactions, or helpful updates through the use of advanced analytics. About the same proportion said they would be willing to share data if they were rewarded for doing so through discounts or personalised offers. 

“The insights that can be gained from data produced by each digital interaction are the key to delivering highly personalised and rewarding customer experiences,” said Johnny Steele, head of banking at SAS UK. “Customers are increasingly aware of this; they want the benefits of a seamless digital experience and, as a result, are becoming more willing to share personal data.”