It’s now pretty much universally acknowledged that the UK retail banking market is being disrupted by new, digital-first competitors – the so-called ‘direct’ banks. The narrative is that these agile upstarts are stealing customers away from incumbents by offering compelling new services and unprecedented levels of convenience.
2018 will go down as a landmark year for the UK banking and payments sector; marked as it was by regulatory changes that have opened the way for new modes of service provision. Here, I want to look at some of the main forces that have shaped the banking and payments landscape in 2018 and look ahead to what this might mean for the sector in the year ahead.
Millennial and Gen X bank customers seem to be relatively independent, adept at employing online and mobile apps to complete their financial transactions. However, research shows that these digitally confident customers still value personalised advice, especially regarding investment decisions—and retail banks are in the best position to meet that need through immediate, tailored solutions developed using available customer data.