British consumes have entered a new banking relationship with a financial institution or non-bank service provider during the COVID-19 pandemic, according to a new report released from financial technology leader FIS® .
The FIS PACE Survey examines how UK consumers have altered the way they shop, bank and pay in response to the pandemic.
The report found that younger Generations are more likely to form new banking relationships, with nearly half of young millennials choosing not to return to their pre-pandemic banking habits.
The most common reason cited overall for starting a new banking relationship was access to better benefits, while the top reason for almost half (48 percent) of Gen Zers (age 18-24) was due to a pivotal moment in their life such as leaving school, getting their first job or starting university.
38 percent of young millennials switched to gain greater access to products or services they couldn’t get previously, such as credit cards and mortgages, while only 7 percent of those surveyed were driven to set up a new banking relationship as a result of an unpleasant customer experience.
Looking forward, the survey found that access to real-time/faster payments were key for consumers in the next six months. Over a quarter (28 percent) of young millennials want increased spending limits on credit/debit cards, while 22 percent of Gen Z are looking to take out a loan.
“After an uncertain financial year for many, UK consumers are seeking a better experience from their bank, with greater access to products and services tailored to their needs,” said Silvia Mensdorff-Pouilly, Head of Banking Solutions Europe at FIS.
“As younger, more tech-savvy consumers enter the financial services market, banks must follow or risk losing engagement with an entire generation. Now more than ever, innovation among banks is critical to ensure a leading position in an increasingly competitive market.”
