42% of financial management platform users have more than one bank account
65% of challenger bank customers still retain at least one account with a high street bank
26% use their challenger bank for their primary account
New research from online money management app Moneyhub reveals that 42% of financial management platform users have more than one bank account, as they take advantage of technological innovation and data sharing in financial services.
Moneyhub’s research found that while many more people are joining challenger banking providers such as Monzo or Starling Bank, 65% of those challenger bank customers also still have accounts with their previous high street lender.
In fact, just 26% use the challenger bank for their primary account. While this may suggest that the challenger banks don’t have as much of a stronghold over their customers as might have been expected, there is an opportunity to capitalise further in the future.
Indeed, just dislodging this cohort of sticky traditional bank customers is an achievement. According to an investigation from the Competition and Markets Authority in 2016, three quarters of current account customers had never switched banks.
As challenger banks roll out more products and begin to offer a fuller-service proposition there is an opportunity for them to make in-roads with some pace with these customers.
Samantha Seaton, CEO of Moneyhub comments: “As customer choice increases, switching becomes quicker, and managing money becomes easier, challenger banks and product providers willing to genuinely place the customer at the very heart of their world are likely to be the beneficiaries. Open Banking continues to present huge opportunities for both product development and service improvements in financial services. This means that it will be those enterprises that ensure their customers benefit from data sharing that will come out on top.
“For those customers currently ‘trying out’ different banking providers, it can be helpful to see all your accounts in one place. Using a money management platform makes moving money between accounts much more streamlined, helping users to feel more comfortable with embracing multi-banking. In doing so users gain a holistic view of their finances and can therefore make more informed decisions for the future.”