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The rise of internet banking

Source: Roy Morgan Research Consumer Single Source, February - July 2013, n=24,979

The recent growth in internet technology and Smartphone usage has changed the way we conduct our banking. In an average 4 week period, 59% (11.2 million) of Australians aged 14+ used internet banking at any financial institution. These figures are based on the latest findings from the Roy Morgan Consumer Single Source Survey.

Although access via the website is still the preferred internet option, conducting banking using an App on a mobile phone or tablet is catching up, with 5 million (26%) bank customers using this method of access in an average 4 week period.

In the 6 months to July 2013, more than half (56% on average) of the customers at each of the big 4 banks in Australia conducted internet banking using the institution’s website or app in an average 4 week period, while less than a third (31% on average) used a branch.

NAB leads the way with 57% of its customers using their internet banking in an average 4 week period, followed by the CBA (56%), ANZ (55%) and Westpac (55%).  In terms of branch banking among the major banks, a marginally higher proportion of CBA customers (33%) used a branch, followed by NAB (31%), ANZ (30%) and Westpac (24%).

The usage of Internet and branch banking varies between institutions largely as a result of the customer demographic profile and the internet banking services offered by each institution.  The age of customers has a big impact on channel selection with branch users on average being around seven years older than those using the internet.

internet-branch-banking-average

The level of customer satisfaction by those using internet banking is very high and is averaging around 91% for the big four, with the CBA the highest on 93%. These levels of satisfaction are all much higher than the overall satisfaction for the big four (79.5%) and considering the high level of usage this is likely to be playing a significant part in the upward trend seen in bank satisfaction.

internet-vs-branch-banking

Norman Morris, Industry Communications Director, Roy Morgan Research says:

“With the decline in branch visits and thus the contact with customers, internet banking increasingly plays a critical role for financial institutions to engage and interact with their customers. It is essential to maintain regular contact with customers to gain loyalty and increase satisfaction.

“One of the challenges facing the banks will be to provide suitable channels to meet the more complex needs of some customers, such as for loans or investments and deposits that are normally associated with older customers who are generally not so predisposed to using the internet. At the end of the day it should be the customers who select the channel, not the banks.

“As long as the institutions can grow their level of service and meet the demands of their customers, we expect the proportion of customers conducting internet banking and using an app to continue its rapid increase.

Click here to view our extensive range of Australian Banking and Finance Reports and Profiles; or click here for information on our Internet Banking users profile and Branch visitor user profile.

For comments or more information please contact:

Norman Morris, Industry Communications Director

Office: +61 (3) 9224 5172

Mobile: +61 402 014 474

Norman.morris@roymorgan.com

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About Roy Morgan Consumer Single Source

Roy Morgan Single Source is based on over 50,000 interviews each year and has been designed and engineered to represent the ideal source model. It provides an integrated understanding of consumers; what they are like, what they consume, what they buy, what they think, what they want, what they watch, read and listen to. The overriding benefit of Roy Morgan Single Source is the strategic insights it offers in the ability to link many aspects. Not only can an organisation’s profitable customers be delineated by what they think, do, watch, but so can non customers. Hence brand positioning, product differentiation, merchandising, efficient media planning, market expansion and line extension opportunities can all be considered in the light of the correct understanding of the marketplace.

About Roy Morgan Research

Roy Morgan Research is the largest independent Australian research company, with offices in each state of Australia, as well as in New Zealand, the United States and the United Kingdom. A full service research organisation specialising in omnibus and syndicated data, Roy Morgan Research has over 70 years’ experience in collecting objective, independent information on consumers.

In Australia, Roy Morgan Research is considered to be the authoritative source of information on financial behaviour, readership, voting intentions and consumer confidence. Roy Morgan Research is a specialist in recontact customised surveys which provide invaluable and effective qualitative and quantitative information regarding customers and target markets.

Margin of Error

The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.

Sample Size

Percentage Estimate

 

40%-60%

25% or 75%

10% or 90%

5% or 95%

5,000

±1.4

±1.2

±0.8

±0.6

20,000

±0.7

±0.6

±0.4

±0.3

50,000

±0.4

±0.4

±0.3

±0.2