Traditional banks might still be the main companies people engage with for their banking but there has been an acceleration in the number of people opening accounts with other banks.
Challenger banks in particular appear to be in a phase where, despite having millions of customers, they are the primary bank for that many people.
As Tandem bank CEO, Ricky Knox, recently told me, Tandem is a second bank for many of its customers. “Spend card behavior is the main way challenger banks are being used,” he said.
This is not a bad thing as consumers are trying out new banks before they even consider moving the bulk of their activity across.
I have an account with a challenger bank, but do moist my banking with one of the high street players. I am not convinced enough to switch that much and really only use the second bank as another way to pay for stuff. I should probably be b raver because I like what I see with the challengers. But at the same time my big high street bank has come on leaps and bounds in digital terms.
The reason I write this now is to flag up a survey from peer to peer lending fintech Zopa, which is launching a challenger bank.
The survey, which questioned about 2000 people, revealed that the number of UK adults with two or more current accounts has increased 36% in the last four years, with 17 million adults now using multiple current accounts.
Furthermore it found that the average person now has a relationship with seven different financial providers
Zopa CEO Jaidev Janardana, “Consumers now have more choice and are actively choosing to shop around for products and providers outside of the main banking relationship. The key to Zopa building a successful next gen bank will be delivering transformative value. We’ve demonstrated this already with our loans business – which has lent over £4bn to UK consumers, proving that savvy customers will consider new alternatives.”
Zopa will launch its own savings and credit card products, as well as a money management app to take advantage of open banking.