Online banking is helping people manage their finances better and reduce their debt as a result
More than two-thirds of consumers can keep on top of their finances because of the arrival and evolution of online banking, and even more control is guaranteed as competition in the banking sector drives investment in technology.
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Twenty years after Nationwide launched the UK’s first online banking service, the building society has surveyed 2,000 people in the UK to find out how online banking has changed the way they manage their money.
The survey revealed that 22% of people are in less debt because they can keep a closer eye on their finances. Almost 70% of people said online banking helps them keep on top of their finances and 40% said it helps them budget better.
Saving time is another benefit identified for online banking, with 28% of people saving at least an hour a week by not having to carry out traditional banking tasks such as waiting at ATMs and visiting branches.
Although 10% of people still don’t use online banking services, the pace of take-up and use has accelerated in recent years as the fintech revolution leads to more customer acceptance. Nationwide itself has reported a 73% increase in the number of customer logins in 2016 compared with 2015.
James Smith, Nationwide’s director of mobile and digital, said: “People are using the ability to log on any time, anywhere to try to ensure they are staying well in control of their finances and attempting to avoid any unnecessary debt.”
Smith said consumers are increasingly being drawn to new ways of making their money management easier. “Innovation in personal finance is clearly something that intrigues people, as three in five believe we will be paying for everything via our thumbprint by 2037,” he said.
According to the survey, about half (55%) of people think phones or watches will be used to pay for everything by 2037, and 40% think cash will stop being used in the next 25 years.
But despite the undoubted consumer thirst for online banking services, a recent major survey of UK consumers revealed that bank branches are more important than mobile apps.
The report, conducted by PwC and the British Banking Association, surveyed 2,000 consumers in the UK about their banking preferences. It showed that 68% of consumers think a bank branch is essential when opening a new current account, compared with 25% who favour a mobile app.