Banking apps rank higher than branches for UK consumers
According to new research by global analytics software leader FICO, the habits, behaviours and preferences of British consumers are changing when it comes to bank accounts. While branch closures continue to attract negative media headlines, three quarters of British consumers surveyed said they see their banking app as the most important or second most important factor about their primary bank account, compared to just 33% citing the need for a local branch as most important. With most consumers (81.5%) still receiving their banking services from a traditional bank, versus 12% using a digital bank, understanding this shift in behaviour is critical.
Published in an ebook, free to download from the FICO website, the research highlights the critical balance between digital and human interaction for bank account holders. While apps are now favoured over a local branch by the majority, the expectation of access to bank staff remains high.
Highlights
- 75% said a good phone app was the most important or second most important factor in their primary provider of banking services
- The younger demographics care more about the quality of their banking apps – just over half of all respondents from the three youngest demographics said this was most important, compared to only 37% of people aged 55-64, and a mere 24% of +65s
- 33% of consumers said it is most important for the bank where they hold their primary account to have a branch nearby
- 80% claimed that having the ability to talk to real people was important
- 51% of respondents 18–24 years old scored human contact 5 out of 5, compared to 60% of over 65s
- 64% believed customer service was as important as the products or services the bank supplied; 22% thought it was more important.
The 2024 FICO Bank Customer Experience Survey provides unique insights into customer behaviours, preferences, and experiences with banks. The majority have two or three bank accounts but one primary account, which was chosen for length of relationship and a positive customer experience.
The advent of improved customer communications and apps has changed consumer expectations. However, 80% of consumer respondents said it was important for them to have access to talk to real people, meaning banks must find the right balance between digital solutions and a customer service team. This is particularly critical when the banking app is not available, as the recent outages make clear. 64% of participants said they believe customer service is as important as the products or services the bank supplies, and 22% said it is more important.
Currently, chatbots are less appealing to consumers than real human interaction, with just 35% saying this service was important to them. As AI continue to evolve, this is an area in which banks must invest to deliver personalised, seamless omnichannel customer support capable of resolving consumer queries quickly and conveniently while reducing costly call centre resource requirements. Customers should be able to flow seamlessly from an AI chat to video or phone support from live staff.
According to the FICO study, the preferred communications method depends upon the subject of the message. Text to their mobile phone was shown to be the preferred method for warnings about potential fraud, ID verification and debt and late payment notifications. Email was preferred for marketing messages, updates to the terms and conditions, information requests and account reminders. Calls to house phones came out as the least popular method of communications in every category.
“Although banking apps have become more important to British customers, it is vital that banks recognise that they can’t rely on them entirely,” commented Mark Whale, a financial services partner at FICO. “A strategic balance between apps and human interactions is critical. Used intelligently, AI can prove invaluable in creating better customer interactions as customers move across to apps. Using analytics to determine the best channel for each individual customer will help brands be more strategic in all areas of communication with their customers, and ensure they foster positive customer experiences and lasting relationships.”
Source: FICO