Our research also shows that European retail banking customers are likely to have both longer relationships with their bank than global peers and fewer banking relationships overall. Globally, of those who see incumbents as their main bank, 45% say they have had a relationship with their provider for more than 10 years; this rises to nearly 60% across our three European markets (and hits nearly 68% in France). Similarly, while 45% of respondents globally say they have three or more financial relationships, this falls to 36.5% in Europe.
However, these advantages cannot be taken for granted. Three key reasons driving trust in primary providers are:
- Confidence that they will protect your data
- Making you feel empowered
- Having a branch nearby, so you can reach them when you want
Incumbents are considered to do well on the first and last of these. Our research highlights that, for European customers, strong privacy policies and features (e.g., ID theft protection, control over data usage) are consumers’ top priority in terms of influence over purchase decisions. But neobanks are not far behind, and there is clearly more that incumbents can do to empower their customers.
Our research shows that neobanks have gained traction with consumers primarily because they are perceived to offer better products and to be more innovative. However, they also appear to do a better job making their customers feel empowered than traditional competitors. For European consumers, elements of personalization are becoming a key part of the trust equation, and there is much more that incumbents can do to address this need.
3. Growing interest by banking consumers of the “super app”
Our research shows consumers’ growing preference for a “one-stop shop” with a range of super apps to satisfy their banking needs. Super apps combine multiple financial services (e.g., checking and savings accounts, investments and payments) via one app or digital experience. Typically, super apps have a higher degree of integration and consumer-centricity than typical banking ecosystems, enabling them to serve as consumers’ personal financial operating systems.
Almost two-thirds of European respondents expressed an interest in super apps, bringing their whole financial services portfolio together. Interest in super apps is particularly high in the UK among consumers with three to five financial relationships. Owning a customer relationship through a super app offers banks the opportunity to better tailor their own offerings and, in turn, help consumers consolidate their banking relationships. But it is also an opportunity for competitors and we have seen early signs of major European neobanks thinking about super apps.
The potential for super apps to enable greater insight and more personalized offerings to retail banking customers, empowering them and giving them greater financial confidence, could be a gamechanger. Firms that do this well will strengthen customer trust and win market share.
Traditional banks still dominate the European banking landscape. That position of strength has, if anything, been reinforced through the pandemic as consumers have turned to established brands to see them through difficult times. But new players are gaining ground at a pace that should focus the minds of the C-suite across the banking sector.
Consumer expectations are rapidly evolving and, to maintain their advantage, incumbents need to build new business models capable of satisfying the evolving needs and market developments. They will need to be more agile, innovative and accelerate their digital transformation.