The Pandemic has unsettled many traditional ways of doing business in Ireland since it began in 2020, pushing many Irish consumers to consider alternative ways to complete the same tasks. A recent survey, conducted by Censuswide and released by digital bank N26, shows just how major this disruption has been. The data indicates that the already increasing trend in use of online and mobile banking has reached a substantial milestone.
69% of respondents said that they trusted digital banking applications to complete their everyday banking needs, with 62% saying they use it because of the ease of use that digital applications bring to their fingertips. The survey also showed a 21% increase in the use of digital payments like Apple and Google pay in Ireland from last year. This is incredibly important because it shows that the Irish consumer is ready and trusts the introduction of more digital financial services being brought into their everyday lives. This includes banking, insurance, and even mortgages.
Another reason for this high number is because 50% of respondents said digital applications bring a fresh new perspective to banking and other sectors. 48% of people said that the transparency it brought to fees and other charges banks and financial services levy on consumers was why they trust digital banks more. This trend will only increase as traditional banks will be looking for alternative ways to bring in revenue as digital banks cut more and more into their business model.
On the issue of fees, 68% of young consumers aged 25 to 34 said they would be in favor of a subscription-based style of banking, very similar to the way Disney, Netflix, and Apple Music have been running for years. Those aged 35 to 44 were right behind at 62%. These numbers are critical because it shows just how welcoming younger people are to this style of service payment and how digital banks can produce revenue.
Furthermore, many traditional Irish banks have been closing branches which have been a huge motivating factor for consumers to make the switch to online and mobile banking. For example, in March the Bank of Ireland announced that it was reducing its retail branch network by almost half! 50% noted that was a reason to make the switch, with others adding traditional banks charging more fees and that had caused them to lose trust. The survey also communicates that 29% of people who have switched relate it to bad virtual customer service received by the main banks in Ireland. Showing just how important it is for digital banks to provide top-notch customer service to differentiate themselves.
When asked about the results of the survey Adrienne Gormley, COO of N26 said; “The last 12 months since the Covid-19 pandemic began has shown us that there is a transition taking place in how we do our banking, from in-person in our local branch to online via a bank’s website or mobile app. I believe Ireland is a prime example of such a transition with the high growth and adoption of digital banks such as N26 as well as the recent announcements by established banks in closing their physical branches and starting to move towards digital banking. One of our key takeaways from this survey is the cautious approach of those aged 55 and over who are unsure about a subscription-based banking model. We’ll be certainly looking at ways to address this with consumers.” The caution regarding those 55 and older is defiantly well-grounded and something all digital financial service providers should be increasingly aware of.
Irish Tech News. “OVER HALF OF IRISH CONSUMERS BELIEVE DIGITAL BANKS HAVE IMPROVED ALL BANKING SECTOR.” Irish Tech News, 1 Apr. 2021, irishtechnews.ie/consumers-believe-digital-banks-improved-banking.
Flinders, Karl. “Bank of Ireland to Reduce Branch Network by Almost Half.” ComputerWeekly.Com, 4 Mar. 2021, www.computerweekly.com/news/252497265/Bank-of-Ireland-to-reduce-branch-network-by-almost-half.