Traditional banks are failing to keep up with direct banks and technology firms.
There are a growing number of customers in the UAE who say that they are who are willing to get banking services from an established technology company, because traditional banks are failing to keep up with direct banks and technology firms, a new study has found.
Bain & Company’s ninth annual customer loyalty in retail banking study, ‘In Search of Customers Who Love Their Bank’, found that traditional banks fail to keep up with direct banks and technology firms in 5 areas that matter most to consumers: quality, saves time, simplifies, heirloom or a good investment for future generations, and reduces anxiety.
According to the survey, 54 per cent of respondents globally, and 50 per cent in the UAE, would trust at least one technology company – Apple, Amazon, PayPal or Google – with their money more than banks.
This trust can translate into a willingness to try banking with these companies, particularly among young respondents. In the UAE, over 80 per cent of survey respondents would be willing to bank with an established technology company that they already use, putting even more pressure on traditional banks to improve the customer experience.
“Despite a rate of mobile and digital penetration among the highest globally, the UAE has a comparatively larger share of banking interactions still happening through traditional channels; this points to significant further digitization potential of the industry,” said Julien Faye, head of Bain’s Emea financial services practice.
“The majority of UAE customers, especially those in the 18-34 age range, now see major technology players as credible alternatives to banks. Banks therefore face an increased risk of their key customer interactions being taken over.”
Nowhere is this more evident than in payments, one of the highest frequency touchpoints for interactions between customer and provider.