The news: A sizable swath of US consumers don’t want to move their primary banking relationships to digital-only players due to security concerns, per a new survey from PYMNTS and Optherium.
At 47.4%, data security was the issue most widely cited by survey respondents who are either just "slightly" or "not at all" interested in switching their primary status to a digital-only bank supported by a large company.
The security generation gap: Older respondents are more likely to name data security as a concern:
The big takeaway: The results indicate that established banks have a competitive advantage over neobanks in consumers’ digital trust.
The perceived superiority of incumbents in safeguarding consumers’ data will come in handy now that digital banking has become the norm:
People with above-average digital trust in their bank are more likely to be valuable customers in some respects than those with below-average trust, per our 2021 Banking Digital Trust Report:
For a deeper dive into the rise of neobanks and the major disruptors that could rattle the competitive dynamics between incumbents and challengers, as well as the wide range of counterattacks available to traditional banks, read “The US Digital-Only Banking Revolution: How Legacy Banks Can Hit Back as Neobanks Take Off.”