Digital banks (such as Monzo, Revolut and Starling Bank) offer simple, fee-free services for people wanting to track their spending immediately from their digital device. Although traditional banks can incentivise customers with lucrative switching offers, digital banks are becoming increasingly popular. We look at the latest digital and online banking statistics in the UK.
Digital banking statistics: Highlights
- 86% of UK adults use a form of online banking or remote banking, which is around 46 million people.
- More than half (53%) of UK adults, around 28 million people, use mobile banking.
- More than two-thirds of Brits (36%) have a digital-only bank account in 2024, up from a quarter (24%) at the start of 2023.
- 1 in 10 Brits (10%) intend to open a digital-only bank account within the next 5 years.
- Overall, half of Brits (49%) either have or intend to open a digital-only bank account.
- Loyalty to an existing banking provider is the top reason for not opening a digital account, given by over half (53%) in this group.
What proportion of UK adults use online banking?
86% of adults in the UK use some form of online banking or remote banking, which is around 46 million people. Furthermore, more than half (53%) of UK adults use mobile banking, which equates to around 28 million people.
How many UK adults have a digital-only bank account?
Our recent survey found that more than two-thirds of Brits (36%) have a digital-only bank account in 2024, which would equate to around 19 million people. The number of people with a digital-only bank account has increased significantly since last year, jumping from an estimated 12.6 million at the start of 2023 to 19.2 million at the start of 2024.
1 in 10 Brits (10%) intend to open a digital bank account in the next 5 years, including 6% who want to open one in 2024.
However, recent reports from the Current Account Switch Service (CASS) show that although digital banks are gaining new customers, they struggle to retain them. In the first half of 2023, digital banks saw a total loss of over 20,000 accounts via the switching service.
It could be that consumers view digital-only banks as additional accounts used for benefits such as cheap overseas payments or conveniently transferring money, but not necessarily viewing them as their main account. We explore the reasons people open digital-only accounts in more detail below.
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| Response | Percentage |
|---|---|
| I have opened an account with a digital-only bank within the last year | 20.00% |
| I opened an account with a digital-only bank more than a year ago | 16.10% |
| I intend to open a bank account with a digital-only bank in the next 12 months | 5.75% |
| I intend to open a bank account with a digital-only bank in the future | 7.55% |
| I am unsure whether I want to open a digital-only bank account | 15.95% |
| I will not consider opening an account with a digital-only bank | 34.65% |
What is the future of digital bank accounts?
As you might expect, the number of digital-only bank account holders is higher among younger generations.
More than half of generation Z (55%) and half of millennials (50%) hold at least 1 digital-only bank account in 2024. Meanwhile, just 1 in 5 members of the silent generation and baby boomers hold a digital-only bank account (21% each) and a third of generation X (34%).
Just under 1 in 5 millennials and generation Zers (18%) who do not currently have a digital bank account intend to open one at some point in the future, as well as 15% of those in generation X.
While a similar number of baby boomers and the silent generation currently have a digital-only bank account, more baby boomers intend to open one than the latter, with 8% compared to just 2%.
- Graph
- Table
| Generation | Already have a digital bank account | Intend to open a digital bank account |
|---|---|---|
| Gen Z | 55.37% | 18.08% |
| Millenials | 49.69% | 18.46% |
| Gen X | 33.99% | 14.78% |
| Baby boomers | 21.31% | 8.09% |
| Silent generation | 20.97% | 1.61% |
Why do people open digital bank accounts?
A quarter of those who have opened a digital bank account did so because they wanted an additional bank account and digital seemed easiest. A further 23% wanted to transfer money more easily, and 1 in 5 (20%) felt it would be more convenient.
Interestingly, 1 in 5 (20%) opened a digital bank account to get better interest rates. This comes in a year when digital accounts such as Chip have been providing competitive interest rates to consumers, while traditional banks have sometimes been slower to pass on rising internet rates to consumers.
Other reasons for switching to digital banking included wanting free transactions abroad (17%), preferring digital-only banking apps (15%), not having a traditional bank branch in the local area (12%), being unhappy with the customer service from their existing bank (11%) and wanting to trade stocks and cryptocurrencies with their new account (10%).
- Graph
- Table
| Reason | Percentage |
|---|---|
| I wanted an additional account and digital seemed to be the easiest option | 24.90% |
| I want to transfer money more easily | 22.57% |
| Using a digital-only bank is more convenient | 20.45% |
| I will get better interest rates | 20.24% |
| I want free transactions abroad | 17.11% |
| My friends and / or family recommended a digital-only bank | 16.80% |
| I think the apps are better | 14.68% |
| Lack of traditional bank branches in my local area | 11.84% |
| I wasn't happy with the customer service from my current bank | 11.03% |
| I want to be able to trade stocks and cryptocurrency with the account | 9.72% |
Impact of bank branch closures
Traditional banks are closing more and more branches across the UK, leaving many Brits with no choice but to embrace digital banking. In fact, for 12% who opened a digital-only account, the lack of bank branches in their local area was a driving factor.
This percentage increases significantly among the older generations, and the lack of bank branches was the top reason for members of the silent generation deciding to open a digital-only bank account, the driving factor for a third (32%) who did so.
Why are Brits unsure about opening a digital bank account?
Among those we surveyed who were unsure or opposed to opening a digital bank account, there were several reasons for this.
The most common reason for not opening a new digital-only bank account was loyalty to an existing banking provider, and this was given by more than half (53%) of this group. This was followed by preferring to have the option to speak to someone or use the physical services in the branch, chosen by 37%.
Another popular reason for not opening a digital bank account was a concern about the risk of payment fraud or a cybersecurity breach, a driving factor for 1 in 5 (21%) of those who hadn’t opened an account.
This fear is more prevalent among the older generations, with almost a quarter (24%) of both baby boomers and the silent generation giving it as a reason for not yet opening a digital account, compared to 17% of millennials and generation Z.
Meanwhile, 11% believe it would be too much hassle to open a digital bank account, 9% don’t know how to open one, 7% believe they would not get better interest rates and 5% want to receive a switching bonus from a traditional bank.
- Graph
- Table
| Reason | Percentage |
|---|---|
| My current bank has always treated me well | 52.96% |
| I prefer having the option to speak to someone in person | 36.96% |
| I am concerned about fraud or cybersecurity breaches | 20.55% |
| It is too much hassle to open a new digital-only bank account | 11.36% |
| I don't know how to open a new digital-only bank account | 9.19% |
| I wouldn't get better interest rates | 7.31% |
| I wanted or want a switching bonus from a traditional bank | 4.74% |
Sources and methodology
- UK Finance – Research on online banking/mobile banking published in 2023, which analyses the digital banking habits of people throughout 2022.
- 2024 Finder survey – Finder commissioned Censuswide in January 2024 to carry out a nationally representative survey of adults aged 18+. A total of 2,000 people were questioned throughout Great Britain, with representative quotas for gender, age and region.
-
Digital banking statistics: Highlights
- An estimated 93% of Brits were using online banking in 2022.
- In 2023, 24% of Brits have a digital-only bank account, compared to only 9% in 2019.
- Around 5.3 million Brits (10%) intend to get a digital-only bank account in 2023.
- 89% of eligible payments in 2020 were contactless.
- Nearly half (49%) of those who opened or intend to open a digital-only bank account cited convenience as a driving factor.
- 16% of people have chosen to open or intend to open a digital-only bank account due to a lack of branches in their area. 53% of the silent generation also cited this as the reason behind their decision to open a digital-only bank account.
- 1 in 4 (24%) traditional bank account holders do not trust digital-only banks.
- 1 in 3 (32%) Brits do not intend to get a digital-only bank account.
What proportion of UK adults use online banking?
According to our research, around 12.6 million Brits (24%) already have a digital-only bank account in 2023. Around another 5.3 million Brits (10%) intend to get a digital-only bank account in 2023. By 2028, the number of digital-only bank account holders is predicted to be 22.6 million (43%). 2 in 5 Brits (39%) can imagine handling all their finances online. Despite the rise of digital banking, about 1 in 3 (32%) Brits do not intend to get a digital-only bank account.
- Chart
- Table
Response Percentage I have already opened a bank account with a digital-only bank (e.g. Revolut, Monzo, Starling etc) 23.75% I intend to open a bank account with a digital-only bank in the next 12 months 9.90% I intend to open a bank account with a digital-only bank by 2028 8.95% I would / will consider a digital-only bank after getting more information 12.30% I do not intend to open a digital-only bank account by 2028 32.35% I don't have a bank account 1.40% None of the above 11.35% What is the future of digital bank accounts?
As you might expect, the number of digital-only bank account holders is higher within younger age groups. 31% of gen Z have a digital bank account, which is 10 percentage points down from 2022. On the other end of the spectrum, 13% of the silent generation have a digital account (6 percentage points up from 2022).
As for which generation plans to switch to digital by the end of the year, gen Z leads the way, with 18% intending to do so. 17% of millennials will switch by the end of 2023, as well as 3% of the silent generation and baby boomers.
Intentions over the next 5 years are similar. Gen Z leads, with 19% planning to go digital by 2028, slightly higher than the 16% of millennials who will do the same. As for the silent generation, under 1% will go digital over the next 5 years.
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Generation Already had a digital bank account Plan to get one by end of year Plan to get in next 5 years Gen Z 31% 18% 19% Millenial 31% 17% 16% GenX 24% 8% 7% Boomer 16% 3% 3% Silent Generation 13% 3% 1% Impact of bank branch closures
Traditional bank branch closures have left many Brits with no choice but to go digital-only. For 16% of those opening a digital-only bank account, a lack of physical branches in their area was a driving factor.
Older generations are disproportionately affected by branch closures, with over half (53%) of the silent generation citing this as the reason for switching or considering switching to a digital-only account.
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Generation Percentage Gen Z 9.45% Millenials 15.14% Gen X 21.74% Baby Boomers 15.23% Silent Generation 52.94% Case study: Bank branch closure has left Samantha stressed
Samantha Evans
Samantha, 36, lives in Wiltshire and tells us about her struggles with bank closures:
When I found out that the branch was being closed, it was really frustrating, to say the least. It has made sure it's harder for me to access actual face-to-face support. It's meant that if I have a problem, I have to call or use my mobile banking app to access support.
There was no support offered or in place. To be honest, there wasn't very much warning either, and it was only by chance that I discovered it was closing. No information was sent out or even uploaded onto the mobile app.
Why do people open digital bank accounts?
When participants were asked why they opened or intend to open a digital-only bank account, the majority (64%) of answers were linked to convenience.
22% of Brits claimed that they were already looking to open a new account, and digital seemed to be the easiest option. A further 21% said that they wanted to transfer money more easily. Another 21% claimed that using a digital-only bank is generally more convenient.
Millennials and gen Z value the ability to trade crypto and stocks with their digital-only bank account twice as much as older generations (14% versus 7%).
- Graph
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Benefit Percentage I wanted an additional account and digital seemed to be the easiest option 22.07% I want to transfer money more easily 21.01% Using a digital-only bank is more convenient 20.54% I will get better rates 19.72% I want free transactions abroad 18.08% I think the apps are better with digital-only bank accounts 17.84% My friends and / or family recommended a digital-only bank 15.73% I like to receive real-time notifications on my spending 15.38% I like the look of the card that comes with digital-only bank accounts 12.91% I want to be able to trade stocks and cryptocurrency with my digital-only bank account (Revolut) 11.50% I wasn't happy with the customer service from my current (traditional) bank 10.56% There are no bank branches in my area anyway 9.04% My traditional bank branch closed in my local area 8.80% I don't trust traditional banks 4.93% Other, please specify 1.29% Why do people not open a digital bank account?
Many people are not on board the digital train, with around 1 in 3 Brits (32%) not intending to get a digital-only bank account by 2028. 50% of traditional bank account holders stayed because of high customer service, and 1 in 4 traditional bank account holders (24%) do not trust digital-only banks. 34% of people value having the option to speak to someone in person and do not intend to open a digital-only bank account.
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Benefit Percentage My current bank has always treated me well 49.72% I prefer having the option to speak to someone in person 33.93% I don't trust new digital-only banks 23.85% It is too much hassle to switch my main account and change my direct debits etc 18.81% It is too much hassle to open a new account 17.25% I wouldn't get better rates 8.62% I wanted / or want a switching bonus from a traditional bank 5.38% I don't know how to switch banks 5.15% I don't know how to open a new account 4.03% Other, please specify 2.24% Online banking trend over time
Online banking popularity has increased steadily between 2007 and 2022, with an estimated 93% of Brits using some form of online banking in 2022. As the level of online banking increases, it may be seen as an indicator that Brits would be more willing to use digital-only banks as they become more used to banking online and on their mobile phones.
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Year Online banking penetration 2005 27% 2006 28% 2007 32% 2008 38% 2009 45% 2010 45% 2011 50% 2012 52% 2013 54% 2014 57% 2015 58% 2016 64% 2017 68% 2018 74% 2019 78% 2020 80% 2021 86% 2022 93%* Sources used
- Finder survey 2023
- Statista
-
The latest stats
- Over a quarter (27%) of British adults have opened an account with a digital-only bank, equating to 14 million people (2021).
- This means 3 times more Brits have a digital bank than in January 2019 (9%).
- By the end of 2021, 38% of Brits either will have or intend to have a digital-only bank – equal to almost 20 million Brits.
- 4 in 5 (80%) use some form of online banking in the UK.
- Just over 1 in 10 Brits (12%) have fully switched to a digital-only bank.
- Nearly half (47%) of those who use them keep less than £1,000 in a digital bank in 2019.
- Two-thirds of banking customers say they plan to convert fully to a digital bank in the future.
What do Brits think their primary banks are good at?
In 2020, digital banking services were rated as the second-best feature of people’s primary banks. Do people, therefore, consider digital services to be a critical component of their financial provider?
Banking features that Brits value
Service Percentage of people Security 40% Range of digital services (app, online banking, etc) 39% Personal service (including telephone, email) 26% Quality of advice 25% Range of financial products and insurance offers 21% Range of payment options 21% Transparency 21% Free-of-charge cash, also abroad 20% Terms and conditions for keeping an account 20% Lending conditions 9% None of the above 7% Don't know 11% Online banking popularity
Online banking popularity has increased steadily between 2007 and 2020, with 4 in 5 Brits now using online banking in 2020.
Since 2005, online banking has experienced year-on-year growth every single year and has reached a peak of 80% in 2020 – meaning 4 out of 5 Brits are using online banking. As the level of online banking increases, it may be seen as an indicator that Brits would be more willing to use digital-only banks as they become more used to banking online and on their mobile phones.
The most popular disruptor banks around the world
We looked at some of the latest statistics to see which disruptor bank is the most popular in the UK.
Total number of app downloads
The most popular disruptor bank in the UK by app downloads in 2020 is Monzo, with over 4.4 million downloads. This is nearly 2 million downloads more than the next biggest challenger bank by app downloads, Revolut, which has 2.5 million app downloads. Starling Bank has had 2.2 million app downloads, and Monese has had over 1 million downloads.
Bank Number of downloads (UK) Monzo 4,427,749 Revolut 2,470,601 Starling Bank 2,172,972 Monese 1,029,375 High-street vs digital banking
Looking at 2020’s third quarter (1 July to 30 September), Starling Bank and Monzo made net gains of 12,652 and 9,157 customers, respectively. Barclays, HSBC, NatWest and Santander all made net losses.
Halifax had the highest overall increase in customers, with a net gain of 22,742 customers. However, Halifax was offering a switch deal during this period and was the only high-street bank to make considerable gains.
The data shows a 65% drop in total switches during lockdown vs the first 3 months of 2020, which reflects a decline in the number of switching incentives while banks seemed to focus on their existing customers.
Brand Gains Losses Net gains Halifax 33,327 10,585 22,742 Starling Bank 14,148 1,496 12,652 Monzo Bank 12,451 3,294 9,157 Lloyds Bank 18,081 9,746 8,335 Bank of Scotland 2,513 1,846 667 Triodos Bank 736 70 666 Ulster Bank 337 398 -61 Danske 151 302 -151 AIB Group (UK) 44 304 -260 Bank of Ireland 57 331 -274 Clydesdale Bank 3,296 3,622 -326 Nationwide 9,670 10,598 -928 Co-operative 1,803 3,433 -1,630 Tesco Bank 55 2004 -1,949 Barclays 5,572 9,067 -3,495 RBS 3,476 7,171 -3,695 TSB 3,512 8,517 -5,005 NatWest 5,904 15,621 -9,717 Santander 11,018 21,047 -10,029 Consumer opinions over the COVID-19 pandemic
Customer sentiment towards 10 of the UK’s biggest high-street and digital-only banks fell by 7 percentage points (pp) during lockdown, according to our new research from finder.com and social analytics specialist BrandsEye.
This leaves overall consumer sentiment for the banking industry at -24% on a possible scale of +100% to -100% for the period between 1 March and 31 July.
However, over 800,000 social media posts from customers revealed that digital banks saw a sentiment decline of almost 3 times that of high-street banks during the pandemic. On average, digital-only banks’ customer sentiment fell by 14pp compared to just 5pp for high-street banks.
While this is a blow for digital-only banks, it should be noted that high-street banks had, and continue to have, a much lower overall sentiment (-13% vs -35%).
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Sentiment pre-lockdown Sentiment post-lockdown Percentage point difference Atom 11.2% 9.2% 2.00% Starling 12.4% -1.4% -13.80% Monzo 1.6% -2.3% -3.90% Monese 0.1% -19.3% -19.40% Revolut -18.0% -29.3% -11.30% HSBC -30.9% -29.9% 1.00% Lloyds -35.9% -32.6% 3.30% Santander -21.3% -33.1% -11.80% Natwest -40.0% -37.0% 3.00% Barclays -21.8% -41.5% -19.70% Common digital bank customer complaints
53% of digital bank customers felt negatively about their provider during the lockdown, with savings rates being the main problem (21%).
Customers’ main method of interacting with their digital-only bank is through an app, so this is perhaps why customers’ second biggest issue was around their bank’s app (15%).
Poor customer service appeared to be a running theme, with 14% of digital-only banks’ customers complaining about the level of customer service they received over the phone and digitally.
Contactless payment
The contactless payment limit in the UK has increased to £100, from being at £45 since March 2020 and previously at £30. By increasing the limit and encouraging consumers to use this payment method, we looked into how this will affect digital banking.
Contactless adoption
Contactless payment adoption was considerably accelerated as a result of the pandemic, with businesses urging consumers to pay through this method. According to data from Barclaycard, 88.6% of total card payments in 2020 were by contactless, 7% more in 2019. However, through being encouraged by businesses and the government, UK supermarkets saw a 29% increase in customers using contactless.
Sources used
- Statista
- Eurostat
- Current Account Switch Service (CASS)
- Barclaycard
- Cyber Crew
Click here for more research. For all media enquiries, please contact:
Matt Mckenna
UK communications manager
T: +44 20 8191 8806
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I'm an enthusiast with a deep understanding of the digital banking landscape, particularly focusing on digital banks like Monzo, Revolut, and Starling Bank. My expertise comes from a comprehensive knowledge of the trends, statistics, and consumer behaviors within the digital banking sector.
Now, let's delve into the concepts covered in the article:
-
Digital Banking Statistics in the UK:
- Usage: 86% of UK adults use some form of online banking, and 53% use mobile banking.
- Digital-Only Accounts: 36% of Brits have a digital-only bank account in 2024, up from 24% in 2023.
- Future Intentions: 10% plan to open a digital-only bank account in the next 5 years.
-
Generational Trends:
- Adoption by Age: Higher adoption among younger generations – 55% of Gen Z and 50% of Millennials have a digital-only bank account.
- Future Plans: Gen Z leads in intending to adopt digital banking by 2028.
-
Reasons for Opening Digital Bank Accounts:
- Convenience: 24% opened an account for additional banking that seemed easiest.
- Money Transfer: 23% wanted to transfer money more easily.
- Interest Rates: 20% opened for better interest rates.
- Other Reasons: Free transactions abroad, convenience, recommendations, app preference, lack of traditional branches, dissatisfaction with current bank, and interest in trading stocks/cryptocurrencies.
-
Impact of Bank Branch Closures:
- Driving Factor: 12% opened a digital-only account due to the lack of traditional bank branches.
- Generational Difference: The silent generation is most affected by branch closures.
-
Reasons for Not Opening Digital Bank Accounts:
- Loyalty: 53% cite loyalty to an existing bank.
- Preference for In-Person Services: 37% prefer the option to speak to someone in person.
- Concerns: 21% worry about payment fraud or cybersecurity breaches.
- Other Reasons: Hassle, lack of knowledge, no better interest rates, and desire for switching bonuses from traditional banks.
-
Future Predictions:
- Growth: Predicted growth in digital-only bank account holders by 2028.
-
Online Banking Trends Over Time:
- Increase: Steady growth in online banking from 2007 to 2022, reaching 93% penetration in 2022.
-
Consumer Sentiment During COVID-19:
- Decline: Consumer sentiment towards both high-street and digital-only banks fell during lockdown.
- Digital Bank Sentiment: Digital banks saw a more significant decline compared to high-street banks.
-
Common Digital Bank Customer Complaints:
- Issues: Savings rates, app functionality, and poor customer service were common complaints.
-
Contactless Payments:
- Adoption Increase: Contactless payments surged during the pandemic, with 88.6% of total card payments being contactless.
These concepts provide a comprehensive overview of the digital banking landscape, including user behaviors, trends, and challenges. If you have specific questions or need more detailed information on any aspect, feel free to ask.
