This report provides comprehensive and current information and analysis of the financial services market including financial services market size, anticipated market forecast, relevant market segmentation, and industry trends for the financial services market in the US.

Current market landscape

Switching financial services was significantly more popular in 2022 than it was in 2021, with large upticks in switching observed for many basic financial products. 22% of checking account owners changed primary providers in the past year, including a whopping 45% of Gen Z checking account owners. Similar behaviors in the credit card and savings account spaces suggest a widespread reconsideration of basic accounts is occurring.

One of the primary drivers of this increase in switching is the anomalous economic context that has consumers feeling the pressure of inflation and searching for solutions to best handle the current environment. Young high-earners have proven to be particularly responsive to inflation, approaching both their existing banks and new institutions for new products to better align with a distinct market context.

Switching financial services market share and key industry trends

Future market trends in financial services

The potentially negative trajectory of consumer credit performance may represent a challenge for the providers that are having success in finding new customers. With delinquency rates starting to rise following an acceleration in debt accrual, consumers in difficult financial situations may face a rocky experience with new credit or lending products, negatively coloring their choice to assume a new financial responsibility.

Despite this threat, the opportunity in the switching marketplace is clear. Volatility is prompting consumers to reassess products that they may have maintained for years with autopilot ownership. New sources of value, from improved rewards to reduced fees, are in demand, and consumers are willing to explore a variety of sources to find an improved experience.

Read on to discover more about the financial services consumer market, read our Consumer Attitudes toward Fintech Market Report – US – 2022, or take a look at our other Financial Services Market research reports.

Quickly understand switching financial service providers

  • Switching behaviors for financial and insurance products.
  • Additions of accounts with new providers while maintaining existing accounts with primary providers.
  • Consideration of future switches for financial products.
  • Institution types for switches and product additions.
  • Motivations for switching.
  • Timing of switches.
  • Attitudes toward switching.

Covered in this switching financial services report

Brands include: Capital One 360, Aspiration, Ally, Citi.

Expert analysis from a specialist in the field

This report, written by Patrick Rahlfs, a leading analyst in the Finance sector, delivers in-depth commentary and analysis on financial services market research to highlight current trends and add expert context to the numbers.

Volatility in the economy has caused a number of downstream effects for consumers, from the increase in debt totals to the rise of interest rates, worsening the penalty for revolving credit. Consumers have responded to this jarring shift in environment by reassessing the effectiveness of their basic financial products, with switching rates for checking accounts, savings accounts and credit cards all making large year-over-year jumps. Young high-earners in particular are responding strongly to the market fluctuations, interpreting the external stimulus as a strategic directive to tweak their financial relationships and adopt the ideal approach for a distinctly new macro environment. Primary institutions will have deepening opportunities as a result of strong loyalty measures, but challenger brands will also benefit from increased exploration of solutions from a variety of providers.

Patrick Rahlfs, Senior Research Analyst
Patrick Rahlfs
Senior Research Analyst

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  1. Overview

    • What you need to know
    • This Report looks at the following areas
    • Definition
    • Market context

  2. Executive Summary

    • Top takeaways
    • More consumers are switching their basic accounts
      • Figure 1: Switching by year, 2021 and 2022
    • Young high-earners are most responsive to the economic climate
      • Figure 2: Timing of new financial relationship consideration, by age and income, 2022
    • Loyalty peaks early, is sustained by rewards
      • Figure 3: Attitudes toward loyalty in financial services, by generation, 2022
    • Market overview
      • Figure 4: Category outlook, 2022-27
    • Opportunities and challenges
    • The time is now for challengers to the status quo
    • Niche products may struggle as consumers focus on the basics
    • Key consumer insights
    • Commercial banks are successfully attracting young consumers
      • Figure 5: Financial institutions being switched to, by generation, 2022
    • Inflation is causing exploration of products within and outside of primary banks
      • Figure 6: Attitudes toward new products due to inflation, 2022

  3. Market Size

    • Debt growth is accelerating
      • Figure 7: US debt composition, 2003-22
    • Serious delinquency rates remain low – for now
      • Figure 8: Percent of balance 90+ days delinquent on loans, by loan type, 2003-22
      • Figure 9: Quarterly change in newly delinquent (30+) balances, by loan type, 2003-22

  4. Market Factors

    • Disposable Personal Income remains suppressed
      • Figure 10: Year-over-year change in disposable personal income, 2017-22
    • Inflation has begun to decline, yet still surpasses 8%
      • Figure 11: Year-over-year change in consumer price index, 2017-22
    • Banking mail volume increased for the sixth consecutive quarter
      • Figure 12: Direct mail estimated mail volume, banking sector, 2020-22

  5. Competitive Strategies and Market Opportunities

    • Capital One is prompting users to switch to a high-yield savings account
      • Figure 13: Capital One 360 Performance Savings Paid Instagram ad, 2022
    • Aspiration takes on big banks directly
      • Figure 14: Aspiration Paid Facebook ad, 2022
    • Ally addresses inflation in TV ad
      • Figure 15: Ally Bank National Television ad, 2022
    • Cross-sell opportunity abounds
      • Figure 16: Citi Double Cash Cross-Sell direct mail piece, 2022

  6. The Switching Financial Services Consumer – Fast Facts

  7. Switching to New Providers

    • 18% of consumers switched checking accounts in the past year
      • Figure 17: Financial product ownership and switching, 2022
    • Loan products owners were most likely to switch providers
      • Figure 18: Portion of product owners that switched, 2022
    • Switching rose noticeably for basic financial products
      • Figure 19: Switching by year, 2021 and 2022

  8. Adding Accounts

    • Personal loans and credit cards can be supplemental products
      • Figure 20: Financial product adding vs switching, 2022
    • Consumers tend to switch and add in tandem
      • Figure 21: Product adding and switching overall behaviors, 2022

  9. Considering Switches

    • More consumers are open to switching than switched last year
      • Figure 22: Financial product switching vs considering a switch, 2022
    • Gen Xers may be an opportunity area for future switches
      • Figure 23: Financial product switching vs considering a switch, by generation, 2022

  10. Institution Types

    • Fintechs and insurtechs trail traditional institutions
      • Figure 24: Financial institutions being switched to, 2022
    • Younger consumers often default to traditional institutions
      • Figure 25: Financial institutions being switched to, by generation, 2022
    • Online-only banks are often used in addition to consumers’ primary providers
      • Figure 26: Financial institutions being switched to vs added additional account, 2022

  11. Motivations for Switching

    • Rewards are the best driver to switch
      • Figure 27: Motivations to switch providers, 2022
    • Investment account explorers seek bonuses, digital experience
      • Figure 28: Motivations to switch providers, by account type consideration, 2022

  12. Timing of Switches

    • Current economic conditions are likely to drive switches
      • Figure 29: Timing of new financial relationship consideration, 2022
    • Young high-earners are most reactive to economic conditions
      • Figure 30: Timing of new financial relationship consideration, by age and income, 2022

  13. Attitudes toward Switching

    • Loyalty is higher among financial services brands than other industries
      • Figure 31: Attitudes toward loyalty in financial services, 2022
    • Young consumers are instinctively loyal; older ones expect rewards
      • Figure 32: Attitudes toward loyalty in financial services, by generation, 2022
    • Inflation has prompted exploration within primary institutions, accounts with new institutions
      • Figure 33: Attitudes toward new products due to inflation, 2022
    • Young high-earners respond most to inflation, turning to primary banks
      • Figure 34: Attitudes toward new products due to inflation, by age and income, 2022

  14. Appendix – Data Sources and Abbreviations

    • Consumer survey data
    • Marketing creative
    • Abbreviations and terms
    • Abbreviations

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