A large majority willing to switch to digital-only banks: Survey

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In what could be seen as a growing trend of digital-first preference, a survey has found more than 7 in 10 Indians are willing to switch to a digital-only (or virtual) bank. The survey, done by McKinsey, as part of a global report, shows the phenomenon of growing neo-banks at the time of increasing digitisation. The McKinsey report stated that such neo-banks or digital-only banks along with robo-advisors could fiercely challenge traditional banking systems.

Findings of the survey

Over 90% saving account holders said that they were already using digital banking at least once a month. And 50% of the people claimed to be using fintech/e-wallet services.

Many experts have over the past few years underscored the shifts in the banking sector, such as the shift from debit or credit card payments to payments authenticated through voice and face recognition software; with reliance of people on traditional banks reducing in the presence of personalised banking services being provided by neo-banks etc.

Growing digital preference

Of the nearly 4,000 people surveyed in India by the consultancy, most respondents belong to tier-I and tier-II cities and a majority of them showed preference towards digital forms of banking. In all 91% of the respondents with savings bank accounts said that they availed various services under the digital banking facilities provided by their banks, at least once a month.

Most of the people surveyed by the consultancy claimed to be digitally capable. Of them 31% turned out to be ‘digital-first’ customers and 67% customers said they used ‘multi-channel’ approaches to banking.

Not so surprisingly, the report found that the behaviour of ‘digital first’ consumers was relatively higher among young people (36%) than among the non-so-young (31%).