Banking Sector Becoming Increasingly Digital
Brick and mortar bank branches are becoming increasingly obsolete. More specifically, customers are expressing greater interest and engagement with neobanks.
Neobanks are those banks which are entirely digital. Being able to operate completely through digital platforms allows neobanks to save the costs associated with keeping physical branches open. This in turn allows for lower fees, which are appealing to consumers.
In fact, a survey conducted by Business Insider Intelligence’s Mobile Banking Competitive Edge Study found that 70% of respondents in the U.S. affirm that mobile banking through digital planforms is the main way in which they access banking services.
More and more products are being offered through digital platforms within the banking sector. For example, mortgage lending is now becoming more popularly accessible online. Having your mortgage approved online is faster than brick and mortar operations by 20%. Additionally, mortgage debt is still a prevalent part of consumer debt in the U.S., accounting for 68% of household debt in 2019.
Generation z is a consumer base that banks are working hard to capture and the path towards doing so is by expanding different digital banking capacities. Gen z consumers make purchases through a mobile wallet on at least a monthly basis.