Customers who shifted their banking channel usage from branches to mobile apps during the coronavirus pandemic are likely to maintain their habits, per S&P Global Market Intelligence’s 2021 US Mobile Banking Survey.
Younger generations were more likely to have changed their banking habits. S&P Global Market Intelligence found that more than 50% of Gen Zers, mIllennials, and Gen Xers are using mobile apps more frequently, compared with a little over 40% for baby boomers and Seniors. Additionally, more than half of the two oldest generations said that they didn’t make changes to their mobile app usage.
Growing mobile usage is coupled with the potential for customers to open accounts with neobanks. Even as the mobile channel shift was common, just 8% of respondents said that they currently have an account with a branchless bank—but almost 44% indicated that they were likely to open one in the future. The difference between current and future account activity indicates that neobanks have a sizable addressable market moving forward, and that incumbent banks have a possible looming competitive threat. However, it remains to be seen whether a significant number will pick branchless banks to serve as their primary ones or choose them for second place—the vast majority of current neobank account holders (83%) have a primary relationship with one of the top 20 US banks, according to a Javelin survey.