2021
9
UK Changing Consumer Needs in Retail Banking Market Report 2021
2021-12-18T03:09:30+00:00
OX1049153
2195
146384
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Report
en_GB
“Retail banking providers have faced steep challenges during the pandemic, and have prioritised customers most at risk of difficulty. In general, though, consumers are not fully convinced of their commitment…

UK Changing Consumer Needs in Retail Banking Market Report 2021

£ 2,195 (Excl.Tax)

Report Summary

The UK Changing Consumer Needs In Retail Banking report identifies consumer attitudes towards retail banking, branch closures and innovations, specialist services and building societies in the UK. 

Current Market Landscape

While only a small percentage of consumers actively disagree that banks and building societies care about supporting vulnerable customers, it still shows how consumers can be sceptical about claims from retail banking providers to be on the side of their customers. This demonstrates the need for brands to prove that these claims are truthful, building trust between the brand and their customers.

  • 37% of consumers are confident that banks and building societies care about supporting vulnerable customers, compared to 9% who actively disagree.
  • Just 8% of consumers with a health condition or impairment have used specialist services to complete banking activities.

COVID-19 has accelerated the long-standing shift from in-branch to online channels in retail banking. This has offered an opportunity to convince previously-reluctant customers of the benefits of digital services. However, it has also made it even harder for vulnerable customers who struggle to manager their money without branch support.

Future Market Trends in Retail Banking

A major hindrance for consumers with non-standard needs is a lack of general awareness of the services brands already provide to assist them. Many will not have needed specialist services, but many others could be missing out because they are not signposted well enough.

Further digital innovation offers a range of opportunities for assisting consumers with non-standard needs. Video banking is a key example, as it offers the reassurance and familiarity of face-to-face branch banking alongside the accessibility and convenience of online banking. This benefits customers who struggle to access branches due to health difficulties, busy working parents, and shift workers alike.

Read on to discover more details or take a look at all of our UK Finances market research.

Quickly understand

  • The size of the retail banking customer base with health- and work-related non-standard needs.
  • Trends in branch closures and innovations in customer service.
  • Evaluation of how well banks and building societies treat customers with health conditions, and experience of specialist services.
  • Consumer preferences for how brands should serve customers with non-standard needs.
  • Consumer trust in brands to care about supporting vulnerable customers, and assessment of the implications of branch closures and the rise of online banking.

Covered in this report

Brands: Lloyds Banking Group, NatWest, Barclays, Nationwide, HSBC, Santander, TSB.

Expert analysis from a specialist in the field

This report, written by Rich Shepherd, a leading analyst in the B2B sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Retail banking providers have faced steep challenges during the pandemic, and have prioritised customers most at risk of difficulty. In general, though, consumers are not fully convinced of their commitment to serving vulnerable customers. This is more to do with a lack of awareness of specialist support, though, suggesting a need for better communication rather than better services.
Rich Shepherd
Category Director – B2B, Social and Economic Research

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Products covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on retail banking
      • Figure 1: Short-, medium- and long-term impact of COVID-19 on retail banking, 2020-25
    • The market
    • More than 14 million disabled people live in the UK
      • Figure 2: Number of people who have a disability*, UK, 2009/10-2019/20
    • Self-employment has grown by 1 million in 20 years, despite being hit by the pandemic
      • Figure 3: Self-employed workers, total and percentage share of all workers, 2001-21
    • Companies and brands
    • The UK branch network shrank by 8% in the year to March 2021
      • Figure 4: Number of branches in the UK, 2017-21
    • Video banking will be the answer for lost branch interactions
    • The consumer
    • Variable pay is the most common challenge for money management
      • Figure 5: Income and payments-related non-standard needs in retail banking, 2021
    • Lack of awareness could be blocking access to specialist support
      • Figure 6: How well consumers consider retail banking providers’ service for customers with health conditions or impairments, 2021
    • Carers are at increased risk of financial difficulty
      • Figure 7: Experiences of retail banking customer services, 2021
    • Consumers want consistent service
      • Figure 8: Interest in features of customer service in retail banking, 2021
    • Banks and building societies need to prove they care
      • Figure 9: Attitudes towards customer service and changing consumers needs in retail banking, 2021
  3. Issues and Insights

    • Consumers want consistent service, not identical services
    • Support for sensory disabilities is ahead of that for other conditions
    • Vulnerable customers are not easy to spot
  4. Disability in the UK

    • More than 14 million disabled people live in the UK…
      • Figure 10: Number of people who have a disability*, UK, 2009/10-2019/20
    • …including 7 million with mobility problems
      • Figure 11: Impairment types reported by disabled people, UK, 2019/20
    • Disability is more prevalent among older groups
      • Figure 12: Percentage of people who have a disability, by age and gender, UK, three-year average 2017/18-2019/20
    • Just 52% of people with a disability are in work
      • Figure 13: Employment status of working-age adults, by disability status and gender, UK, 2019/20
  5. Employment and Consumer Needs in Retail Banking

    • Self-employed population has grown by 1 million in the last 20 years
      • Figure 14: Self-employed workers, total and percentage share of all workers, 2001-21
    • 1.2 million workers had more than one job in Q3 2021
      • Figure 15: Workers with a second job, total and percentage share of all workers, 2001-21
    • Use of zero-hours contracts has increased sharply in the last decade
      • Figure 16: Workers on a zero-hours contract, total and percentage share of all workers, 2001-21
  6. Company Developments and Market Context

    • The UK branch network shrank by 8% in the year to March 2021
      • Figure 17: Number of branches in the UK, 2017-21
    • Concern over ‘last in town’ branches
      • Figure 18: Number of branches, branches that are last in community and mobile branches, by provider, 2021
    • Mobile branches can offer a valuable replacement…
    • … but virtual services offer greater reach
    • Serving the gig economy
    • Innovations in accessibility
  7. Non-standard Income and Expenses

    • Variable pay is the most common challenge for money management
      • Figure 19: Income and payments-related non-standard needs in retail banking, 2021
    • Young males are most likely to have more than one job
      • Figure 20: Agreement with the statement “I have more than one job”, by age and gender, 2021
    • A quarter of workers use international transfers
      • Figure 21: Agreement with the statements “I regularly receive payments from overseas” and “I regularly send payments overseas”, by gross annual household income, 2021
  8. Evaluating Customer Service and Disability

    • Banking services for the disabled are most appreciated by carers
      • Figure 22: How well consumers consider retail banking providers’ service for customers with health conditions or impairments, by experience of health conditions/impairments or caring responsibility, 2021
    • People with sensory disabilities feel best supported
      • Figure 23: How well consumers consider retail banking providers’ service for customers with health conditions or impairments, by presence of selected health conditions/impairments, 2021
    • Nationwide and Santander customers are least aware of services
      • Figure 24: How well consumers consider retail banking providers’ service for customers with health conditions or impairments, by main current account provider, 2021
  9. Retail Banking Experiences

    • A quarter have experienced great customer service
      • Figure 25: Experiences of retail banking customer services, 2021
    • Carers are at increased risk of financial difficulty
      • Figure 26: Experiences of retail banking customer services, by experience of health conditions/impairments or caring responsibility, 2021
    • Use of specialist support services is limited
      • Figure 27: Experiences of retail banking customer services, by presence of selected health conditions/impairments, 2021
  10. Customer Service Preferences

    • Consumers want consistency of service…
      • Figure 28: Interest in features of customer service in retail banking, 2021
    • … but this requires accommodations for specific needs
      • Figure 29: Interest in features of customer service in retail banking, by experience of health conditions/impairments or caring responsibility, 2021
    • Tech-savvy younger groups still appreciate help with online banking
      • Figure 30: Interest in “Extra assistance for online and mobile banking services”, by generation, 2021
    • Virtual consultations can maintain valuable customer/staff relationships
  11. Changing Consumer Needs in Retail Banking

    • Banks and building societies need to prove they care
      • Figure 31: Attitudes towards customer service and changing consumers needs in retail banking, 2021
    • The shift online has given with one hand but taken with the other
    • Young, professional parents are most likely to say brands have moved with the times
      • Figure 32: Changing Consumer Needs in Retail Banking – CHAID – Tree output, July 2021
  12. Appendix – Data Sources, Abbreviations and Supporting Information

    • Branch network data
    • Abbreviations
    • Consumer research methodology
    • CHAID methodology
      • Figure 33: Changing Consumer Needs in Retail Banking – CHAID – Tree output, July 2021
      • Figure 34: Changing Consumer Needs in Retail Banking – CHAID – Table output, July 2021

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.

Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.

*databooks not available with UK B2B Industry reports.

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