A recent survey by global payments service provider FIS has revealed that digital banks are making inroads in Singapore, with 43% of respondents indicating they are likely to try one in the next year.
This comes in addition to the 29% who have already embraced digital banking.
The survey, which polled over 1,000 retail banking customers, highlights the growing appeal of digital banks across all age groups.
For example, 21% of Baby Boomers (those aged 59 and above) have already signed up with a digital bank, while 38% of Gen Z respondents (aged 18-27) are now banking with one.
Despite this trend, traditional banks continue to enjoy high levels of customer satisfaction, with 72% of respondents expressing contentment with their primary bank.
Customer loyalty remains strong, with the average customer relationship lasting nearly 20 years.
Digital Banks vs Traditional Banks
The survey also identified key factors influencing consumer choices.
48% of those hesitant to try digital banks cited satisfaction with their current bank, while 36% pointed to the lack of physical branches, and 34% were concerned about the inability to have in-person interactions with bank representatives.
Conversely, of those open to digital banking, 45% were drawn to higher interest rates on deposits, 37% were attracted by sign-up bonuses, and 34% appreciated the appeal of a strong rewards programme.
For existing digital bank users, convenience, ease of use, and security were the primary attractions.
Interestingly, the survey found that a significant majority (79%) of respondents desire a simplified user experience on financial apps.
Many reported feeling overwhelmed by the complexity and number of available apps.
Specifically, respondents identified issues such as technical glitches, service disruptions, an overabundance of features that complicate app use, and difficulties in navigating the apps.
Kanv Pandit, Head of Corporates and International Banking, FIS, said,
“With the surge in demand for digital banking, traditional banks in Singapore have accelerated their digitalisation programmes and are working hard to attract and retain customers. New digital banks are quickly gaining popularity, not just amongst younger customers who are digital natives, but across all demographics.
As our survey suggests, many customers are still choosing to remain with established banks, however, there is no room for complacency in the banking industry. Technology is now essential for banking, with outdated systems and manual tasks often coming at the expense of customers.”
Featured image credit: Edited from Freepik
