Most consumers do not view digital banks as a “true alternative” to traditional banks, according to a recent survey by industry news site PYMNTS.com and software solutions provider Treasury Prime. The two companies polled 2,124 U.S. consumers about their attitudes concerning digital banking and found that 39% of respondents said digital banks could be an alternative to traditional banks. Still, of those respondents, more than half said they had no plans to switch to a digital bank.
Asked why they were sticking with a traditional bank, 34% of respondents cited a lack of interest in digital bank alternatives, 15% cited concern for the overall security of their money and information, 14% did not trust digital banks’ reliability or longevity, and 13% wanted to retain access to physical branches.
At the same time, the survey found that two-thirds of respondents were using digital banking services of some kind, with millennials and members of Generation Z being among the heaviest users. Freelancers, small business owners and consumers who live paycheck to paycheck with issues paying bills were more likely to gravitate toward digital banks, according to the report. Improved transfers were the main draw for respondents with digital-only banking interest, with 43% saying it was their greatest motivator. The next most common motivator was lower costs (33%) followed by improved notifications (17%)