Sorry for interrupting, this website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Learn more
Accept & Close

UK Consumers and Banking Innovation Market Report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Consumers and Banking Innovation market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Covered in this report

This report explores consumers’ engagement with, and attitudes towards, innovation in the UK retail banking industry. This includes products such as current accounts, savings accounts, mortgages, personal loans and credit cards.

In this report, consumers’ approach to innovation is based on responses to the question “Which of the following apply to you when your main bank or building society introduces a new product/service (eg new payment methods, new ways to manage accounts online).

Early Adopters – Consumers who respond, “I try it straight away”.

Early Mainstreamers – Consumers who respond, “I wait until some people have used it before trying”.

Late Mainstreamers – Consumers who respond, “I wait until it’s widely used before trying”.

Laggards – Consumers who respond, “I won’t try it until I really need to”.

Key points included

  • Innovation cannot be allowed to threaten financial inclusion
  • Security is still the key barrier to adopting new services
  • Innovation is generally seen to be positive

Expert analysis from a specialist in the field

Written by Richard Shepherd, a leading analyst in the Financial Services sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The launch of Open Banking has transformed the retail banking landscape for providers looking to attract customers with innovative services. However, the limited participation of the biggest banking brands and consumers’ cautious approach towards new services has resulted in a muted impact so far. Open Banking needs clear support from high street brands before consumers can be expected to buy into it en masse. Richard Shepherd
Senior Financial Services Analyst

What you get

What's included

Why buy from us?

Succeed

Our reports will provide you with market data, consumer research and competitive intelligence to succeed in your market.

Instant Access

Buy now and you'll have instant access to the information you need to make the right decisions.

Opportunities

Find out what's next in the markets that matter to you: where opportunities lie and what challenges you will face.

Trusted

A business Superbrand, Mintel is a source you can trust. We have been defining and refining the Market Intelligence mix since 1972.

Table of contents

  1. Overview

    • What you need to know
      • Products covered in this report
      • Executive Summary

          • The market
            • Open Banking and GDPR combine to create new data sharing environment
              • The consumer
                • Current accounts are the primary point of interaction with providers
                  • Figure 1: Retail banking product ownership, September 2018
                • 37% consider banks to be at least somewhat innovative
                  • Figure 2: Ranking of how innovative firms are in different sectors, September 2018
                • Most use contactless cards but are cold to further payment innovation
                  • Figure 3: Banking innovations used in the last 12 months, September 2018
                • Most consumers are slow to pick up new services
                  • Figure 4: Approach to new banking innovations, September 2018
                • Half want to see improved security
                  • Figure 5: Interest in future banking innovations, September 2018
                • Open Banking still hamstrung by attitudes towards data sharing
                  • Figure 6: Attitudes towards banking innovation, September 2018
                • What we think
                • Issues and Insights

                  • Innovation cannot be allowed to threaten financial inclusion
                    • The facts
                      • The implications
                        • Security is still the key barrier to adopting new services ...
                          • The facts
                            • The implications
                              • …but innovation is generally seen to be positive
                                • The facts
                                  • The implications
                                  • The Market – What You Need to Know

                                    • Open Banking and GDPR combine to create new data sharing environment
                                      • HSBC leads the way on the high street
                                      • Market Environment

                                        • Regulatory context
                                          • Open Banking and PSD2 come into force
                                            • GDPR provides consumers with greater control and protection over data
                                              • Payments
                                                • Cash is far from falling out of favour
                                                  • Figure 7: Use of payment methods, February 2018
                                                • Channel preferences
                                                  • Online platforms are favoured for almost all banking needs…
                                                      • Figure 8: Channel preference in retail banking, by activity, June 2018
                                                    • …but branches remain highly valued
                                                    • Recent Developments

                                                      • FCA welcomes the fourth cohort of regulatory sandbox participants
                                                        • Open Banking launches
                                                          • HSBC leads the way on the high street
                                                            • Marketplaces point towards a fully realised Open Banking environment
                                                              • Other major brands have been slow to develop new services
                                                              • The Consumer – What You Need to Know

                                                                • Current accounts are the primary point of interaction with providers
                                                                  • 37% consider banks to be at least somewhat innovative…
                                                                    • Most use contactless cards but are cold to further payment innovation
                                                                      • Most consumers are slow to pick up new services
                                                                        • Half want to see improved security
                                                                          • Open Banking still hamstrung by attitudes towards data sharing
                                                                          • Retail Banking Product Ownership

                                                                            • Current accounts are the primary point of interaction with providers
                                                                              • Figure 9: Retail banking product ownership, September 2018
                                                                            • Consumers acquire more products with age
                                                                              • Figure 10: Number of surveyed retail banking products owned, September 2018
                                                                              • Figure 11: Number of surveyed retail banking products owned, by age, September 2018
                                                                          • Banking Innovation in Context

                                                                            • 37% consider banks to be at least somewhat innovative…
                                                                                • Figure 12: Ranking of how innovative firms are in different sectors, September 2018
                                                                              • …rising to half of under-25s
                                                                                • Figure 13: Agreement that banks are quite innovative or very innovative, by age, September 2018
                                                                              • Access influences perceptions of innovation
                                                                                • Figure 14: Ranking of how innovative credit card companies are, by gross annual household income, September 2018
                                                                              • Borrowers more likely to see banks and building societies as innovative
                                                                                • Figure 15: Agreement that banks and building societies are quite innovative or very innovative, by retail banking product ownership, September 2018
                                                                            • Innovative Banking Activities

                                                                              • Opposition to payment innovation is entrenched
                                                                                • Figure 16: Payment innovations used in the last 12 months, September 2018
                                                                              • Younger consumers more likely to use payment innovations
                                                                                • Figure 17: Payment innovations used in the last 12 months, by age, September 2018
                                                                              • Has mobile banking reached a plateau?
                                                                                • Figure 18: Banking innovations used in the last 12 months, September 2018
                                                                              • Analytic tools have space to grow
                                                                              • Approach to Banking Innovations

                                                                                • Most consumers are slow to pick up new services
                                                                                    • Figure 19: Approach to new banking innovations, September 2018
                                                                                  • Millennials are the key innovation trialists
                                                                                    • Figure 20: Approach to new banking innovations, by generation, September 2018
                                                                                  • Contactless cards are a must-use technology…
                                                                                    • Figure 21: Banking innovations used in the last 12 months, by approach to new banking innovations, September 2018
                                                                                  • …while Early Adopters are starting to get on board with Open Banking
                                                                                  • Interest in Banking Innovations

                                                                                    • Most can identify areas for improvement …
                                                                                      • …but not always areas for innovation
                                                                                          • Figure 22: Interest in future banking innovations, September 2018
                                                                                        • Early Adopters and Early Mainstreamers show healthy interest in most innovations
                                                                                          • Figure 23: Interest in future banking innovations, by approach to new banking innovations (Early Adopters and Early Mainstreamers), September 2018
                                                                                        • Laggards can be tempted with security innovations
                                                                                          • Figure 24: Interest in future banking innovations, by approach to new banking innovations (Late Mainstreamers and Laggards), September 2018
                                                                                      • Attitudes towards Banking Innovation

                                                                                        • Open Banking still hamstrung by attitudes towards data sharing
                                                                                          • Two thirds think banks should walk before they run
                                                                                            • Figure 25: Attitudes towards banking innovation, September 2018
                                                                                          • Innovation is appreciated, but concerns abound
                                                                                            • Even Early Adopters doubt the potential of digital services
                                                                                              • Figure 26: Attitudes towards banking innovation, by approach to new banking innovations, September 2018
                                                                                            • Half say innovative brands have a competitive edge
                                                                                            • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                              • Abbreviations
                                                                                                • Consumer research methodology