By Julian Goldsmith, 6 November 2007 10:56
NEWS
The UK is an online banking laggard, with only a third of the population managing their finances through the channel, compared to two-thirds shopping online. And one reason for this is customers are happy with the branch and phone banking services available.
Although the number of consumers switching to online banking in the UK is growing, this growth is not as swift as other European countries.
silicon.com Financial Services
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A survey of banking behaviour from Forrester Research, entitled UK Online Banking Forecast: 2007 To 2012, investigated the perceptions of more than 4,000 UK consumers. It found they are dissuaded from using banking services online due to the good service in branch and on the phone.
The researchers forecast online banking will grow to around 22 million users by 2012, or 58 per cent of internet users.
According to Forrester principal analyst, Alyson Clarke, the strategy of offering branch, phone and ATM services for free is the biggest factor causing the slow uptake of online banking in the UK.
Clarke said: "There are no real disincentives to going into a branch, as there are in other countries, so customers aren't encouraged to go online."
She told silicon.com UK banks are missing out by not having a better online relationship with their customer bases. "Banks will have a better understanding of their customers if they are encouraged to bank online," she said. "This information can be used to better target offers to them. It also means customers will get a repeatable experience when their finances are processed, giving banks greater control over customer service."
Comments
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1. Sarah
"It found they are dissuaded from using banking services online due to the good service in branch and on the phone."
Are they sure they were talking to UK consumers? Ok, if you want to stand in a queue in a branch for an hour or more at lunchtime because they cannot be bothered to open more than a couple of the desks. Or if you phone a "call centre" you are on hold for ages and when you get through to someone, they cannot do what you want, do not understand you or end up not following your instructions correctly.
Give me online any day ...
2. Jeremy Wickins
When experst such as Frank Abignale say they don't use internet banking because it is inherently flawed, why should I? I never have, and never will. Internet banking is just a way for banks to save money through redundancies. We should all be going to branches - it maintains jobs in the locality, and it is personal.
3. Richard A
Barclays have just taken a Great Leap Backwards by introducing the utterly stupid PINsentry system.
I used to be able to do online banking anywhere and at any time so long as I knew my security code and password.
Now I need my debit card and the PINsentry to generate a new code every time I want to bank online - and it is a right pain in the banking sector.
Whereas it was once quick, easy and practical to bank online - all I needed was my brain and a computer - I now need to carry the PINsentry (the size of a calculator) and my debit card wherever I am in the world (and hope neither gets lost, broken or stolen).
Furthermore, by putting all their eggs in one basket, I no longer have the fallback of online banking, should anything happen to my debit card. And should one system be compromised by fraud, so will the other, only now Barclays can entirely blame me.
Of course security is a vital issue for online banking but any system that cripples it by negating all its benefits (speed, convenience, simplicity and geographical independence) renders it worthless.
Online banking 2000-2007 RIP
4. Peter Williams
Absolute Nonsense! I bank online, & as an IT professional I'm in the right place to be petrified of the consequences of not keeping my security softwares (more than one is essential) up to date.
And as for offering "no real disincentives to going into a branch" - does that mean the usual suspects are to suffer? The elder citizens who are unable to afford a computer -never mind having the foggiest how to use them & keep themselves safe online- forced to PAY for over the counter services perhaps?
No, the current balance is correct.
The slow take up of their IT offerings are a testament to the publics’ lack of confidence in the security of their online options.
Improved security will guarantee a steady uptake as confidence grows. Some people will never consider it though & that is a fact that the banks are just going to have to accept.
5. Paul
I agree wholeheartedly with Richard A.
"It was once quick, easy and practical to bank online - all I needed was my brain and a computer - I now need to carry the PINsentry (the size of a calculator) and my debit card wherever I am in the world (and hope neither gets lost, broken or stolen)."
Where is the flexibility of online banking with Barclays now gone??
I cannot use the online services when travelling, when abroad or even at work (yes we all do it), without the PINSentry device. Bank of Ireland used to have a similar one in the 1990s and thankfully got rid of it.
I'm seriously considering leaving Barclays and moving to another bank!!!