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Polling

Momentive study: neobanks – the future of banking goes digital

Momentive study: neobanks – the future of banking goes digital

Key findings:

  • Banking goes digital as mobile apps become the dominant method of accessing bank accounts
  • LATAM leads the way in neobank adoption, with the majority of adults in BR having both a digital and traditional bank account
  • Neobanks see higher adoption among younger age cohorts and lower-income consumers
  • Satisfaction and usage of neobanks banks exceed that of traditional banks, especially in LATAM
  • Ease of use and accessibility drive neobank adoption, while lack of in-person support and security concerns are among the leading complaints for customers of neobanks

Banking goes digital as mobile apps become the dominant method of accessing bank accounts

The majority of adults access their bank account via a mobile app on their smartphone, with adults in LATAM seeing the highest adoption, and those in the US and UK trailing. 

  • Online access via laptop, computer, or tablet trails far behind mobile usage
  • ATM access is among the most used methods of accessing bank accounts
  • Across all countries, less than one in five access their bank accounts via phone call

Neobanks see growing adoption among lower income consumers and younger age groups

Neobanks are largely adopted as a complement to traditional banks, with more consumers opting to do business with both a traditional bank and a digital bank rather than solely with a digital bank or traditional bank. Lower income and younger consumers drive the move toward digital as mobile-only banking and lower barriers for approval provide alternative access to banking apart from traditional services. In the US, Brazil, and Argentina, less than half of adults only have a traditional bank account, instead adopting digital-only, or both digital and traditional banking.

Digital banking customers are more satisfied with their neobanks than with their traditional banks

There are, however, signs of neobanks posing a competitive threat to traditional banks as overall satisfaction toward digital banks is higher than that of traditional banks among those who have both types of accounts.

  • 63% of patrons in the U.S. are very satisfied with their digital bank, compared to 55% of traditional banks
  • 59% of patrons in the U.K. are very satisfied with their digital bank, compared to 51% of traditional banks

LATAM countries see an even greater satisfaction gap between the two solutions:

  • In Mexico, satisfaction toward digital banks is 15 percentage points higher than that of traditional banks (77% vs 62%). Argentina sees a similar disparity (66% vs. 53%)
  • Satisfaction with traditional banks is lowest among patrons in Brazil, with satisfaction toward digital banks almost twice as high as traditional banks (73% vs 40%)

Usage of digital banks rival that of traditional banks - among those with both a traditional and digital bank account:

  • In Brazil, 50% use their digital bank more often than their traditional bank, nearly 5 times the number who use their traditional bank more often (11%), and 4 in 10 (39%) use them both equally
  • Only 1 in 6 (16%) in Mexico use their traditional bank more than their digital bank, while twice the number use their digital bank more often. Rather, the majority use both equally (50%).
  • Consumers in the UK remain more reliant on traditional banks - 43% say they use their traditional bank more often, while only a quarter (25%) use their digital bank more often. 

Ease of use and accessibility drive neobank adoption, while lack of in-person support and security concerns are among the leading complaints for customers of neobanks

Superior user experiences are driving the adoption of neobanks, rather than the advertised advantages of neobanks over traditional banks, such as lower fees and higher interest rates. Fluid approval processes, and ease of mobile app are among the top reasons for choosing a digital bank, along with ease of managing money and always-available service.

Frustrations with the digital-only experience also arise: having no in-person customer service is the leading complaint among digital bank customers in the US and UK, while concerns over security and a lack of in-network ATMs are the leading complaints in Brazil, Mexico, and Argentina..

Read more about our polling methodology here.