The closure of high street banks has hit the headlines in 2019, with 19% of people in the UK now living over two miles away from a bank, according to The Guardian.
According to Which? 3,312 bank and building society branches closed their doors between January 2015 and August 2019, with an average of 55 closures a month. Although this may have a negative impact on how some people access banking, for others this is not viewed negatively.
New research by Boomi revealed that one in five customers would support bank closures if it meant a better digital experience.
Boomi, a Dell Technologies business, surveyed 6000 adults in the UK and Europe on banking customer experience and one in five UK customers say their traditional bank feels ‘a bit old’ and 22% would be happy if their bank closed its branches if it led to a better mobile or online banking experience. This figure rises to 39% among 18-24 year olds.
37% cited a good online banking experience as important, with customers preferring to communicate with their banks via phone, email or mobile app rather than face-to-face.
As of January last year, Open Banking requires banks to increase transparency and open APIs to enable third-party developers to access to their account holder data and services. Just 21% of respondents say their current bank offers open banking services, while 66% are not sure if it does.
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According to AltFi, the number of people in the UK switching to challenger banks Monzo and Starling for their primary account rose 60% last quarter. With one in five holding a digital bank account with a challenger bank as well as their ‘traditional’ bank account, banks must now improve their digital customer experience in order to compete with newer tech-savvy startups.
Derek Thompson, VP of EMEA at Boomi said:
“New account holders won’t hold the same loyalty to their bank as previous generations have. New players entering the market have challenged the industry status quo thereby setting a new standard around the digital banking experience, forever changing customers’ expectations. Customers are looking for more than better products when choosing their next provider. It’s therefore critical that banks assess their current IT ecosystem, ensuring they’re not held back by their legacy infrastructure and can quickly unite their digital ecosystems, deploying more agile technology to transform customer experience.”