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Internet & Telephone Banking Market Report 2013

  • March 2013
  • -
  • Key Note Publications Ltd

Executive Summary

Technological revolution has caused significant change in the Internet and telephone banking market in recent years, and is expected to play a key role in shaping it in the future. There has been change to both the users and the overall products.

Internet banking, and mobile banking in particular, have been a major success story for the banking industry. Many of the everyday banking transactions that would once have required a branch visit can now be done online or using a smartphone or other mobile device. This includes applying for loans and overdrafts, as well as paying bills, checking balances, and making transfers. The ease and speed with which such transactions can now be carried out via the Internet has been a key factor in the service’s success from a customer perspective; at the same time, banks enjoy lowered overheads the wider spread Internet banking becomes.

However, the rise to prominence of Internet banking has been at the cost of the decline of telephone banking. Between 2008 and 2012, the number of personal bank accounts registered to be accessed via the Internet increased by 23.4%; over the same period, the number of customer accounts registered to be accessed over the telephone declined by 28%.

Mobile banking is also rising rapidly in terms of the volume of users, with the arrival of tablet computers acting to further boost a market that was already primed for meteoric growth before this intervention. It allows users the same functions of Internet banking but, with Third Generation (3G) technology, and Fourth Generation (4G) technology coming soon, customers can access their accounts, pay bills and makes transfers, etc. on the move, wherever they are. The number of adults in the UK accessing the Internet through their smartphone reached 17.6 million in 2011, representing almost half (45%) of all Internet users. Clearly, this market is ready to be tapped and indeed many banks and building societies are already making inroads towards doing so.

For the future, Key Note is predicting a further increase in the number of accounts registered to be accessed online, although by 2017 growth will have slowed as online access to bank accounts slowly becomes more universal and there are fewer older accounts to convert to having online access.

Between 2013 and 2017, Key Note forecasts that the number of accounts registered for Internet banking will increase by 17.8%, which would equate to growth of 52.6% between 2008 and 2017. Telephone banking, on the other hand, is set to continue to decline in terms of registered customers over the next 5 years, with the number registered declining by 16.4% between 2013 and 2017. Between 2008 and 2017, this represents a decline of 42.6% in total, driven by banks increasingly moving towards online distribution and consumers favouring Internet and mobile banking over carrying out transactions via the telephone.

Table Of Contents

Internet and Telephone Banking Market Report 2013
Table of Contents

Foreword

Executive Summary

Market Definition

INTRODUCTION
REPORT COVERAGE
MARKET SECTORS
Internet Banking with a Computer
Mobile Banking
Telephone Banking
MARKET TRENDS
Internet Banking's Rise at the Cost of Telephone Banking's Demise
Sales of Tablets Rise
Fourth Generation Mobile Internet Technology
An Online World
ECONOMIC TRENDS
MARKET POSITION
The UK
Overseas

Market Size

INTRODUCTION
THE TOTAL MARKET
BY MARKET SECTOR
Internet Banking
Telephone Banking
Mobile Banking
OVERSEAS TRADE
General Overview

Industry Background

RECENT HISTORY
NUMBER OF COMPANIES
Banks
Building Societies
EMPLOYMENT
Banks
Building Societies
REGIONAL VARIATIONS IN THE MARKETPLACE
HOW ROBUST IS THE MARKET?
LEGISLATION
Financial Services Compensation Scheme
Distance Marketing of Financial Services Regulations
Money Laundering
The Financial Services Act
The Bank of England
HM Treasury
KEY TRADE ASSOCIATIONS
British Bankers' Association
Building Societies Association
Euro Banking Association
European Banking Federation

Competitor Analysis

THE MARKETPLACE
MARKET LEADERS
Barclays PLC
HSBC Holdings PLC
Lloyds Banking Group PLC
Nationwide Building Society
The Royal Bank of Scotland Group PLC
Santander UK PLC
OTHER COMPANIES
Citibank International PLC
The Co-operative Bank PLC
Marks and Spencer Financial Services PLC
Metro Bank PLC
National Australia Bank
Tesco Personal Finance Group Ltd
Virgin Money PLC
MARKETING ACTIVITY
Online and Telephone Banking
Mobile Phone Banking
SPONSORSHIP

Strengths, Weaknesses, Opportunities and Threats

STRENGTHS
WEAKNESSES
OPPORTUNITIES
THREATS

Buying Behaviour

CONSUMER RESEARCH
Summary of Findings
CONSUMER ATTITUDES
S1: "I Am Concerned About the Security of Mobile Banking"
S2: "I Would Change My Bank If Its Internet Banking Services Were Poor"
S3: "I Am Concerned About the Security of Internet Banking"
S4: "I Started Using Internet Banking in the Last Years"
S5: "I Would Change My Bank If Its Telephone Banking Services Were Poor"
S6: "I Manage My Money Using a Tablet Computer or Other Mobile Device"
S7: "I Started Using Mobile Banking in the Past Year"
S8: "I Manage My Money on a Tablet Computer or Other Mobile Device Using a Mobile Version of My Bank or Building Society's Website"
S9: "I Manage My Money by Using a Mobile Phone"
S10: "I Manage My Money on a Mobile Phone Using a Mobile Application from My Bank or Building Society Specifically Designed for That Purpose"
S11: "I Started Using Internet Banking in the Last Year"
S12: "I Manage My Money on a Mobile Phone Using a Mobile Version of My Bank or Building Society's Website"
S13: "I Manage My Money on a Tablet Computer or Other Mobile Device Using a Mobile Application from My Bank or Building Society Specifically Designed for That Purpose"
S14: "I Would Like to Manage My Money via the Internet But I Do Not Know How"
ACCESSING BANKING SERVICES
Internet
Telephone

Current Issues

SWITCHING ACCOUNTS
Price Comparison
FASTER PAYMENTS
UNIVERSAL MOBILE PAYMENTS
NEAR-FIELD COMMUNICATION IN SMARTPHONES
SECURITY CONCERNS
Internet Banking
Mobile Banking
MOBILE BANKING CONTINUES TO GROW
Apps and the Internet
Tablet Computer Penetration Grows Strongly
MORE BANK BRANDS
But Continued Branch Closures?
THE ENVIRONMENT

The Global Market

DEVELOPED ECONOMIES
The US
Canada
Australia
Europe
DEVELOPING NATIONS
People's Republic of China
Mexico
MAJOR TRENDS AND FUTURE DEVELOPMENTS
Mobile Banking
Internet Banking

Forecasts

INTRODUCTION
Economic Forecasts
FORECASTS TO
Internet Banking
Telephone Banking
MARKET GROWTH
FUTURE TRENDS
Mobile Banking to Take Off Nationally and Internationally
Mobile Phones, Banking and Security Innovations
Convincing Customers to Move to New Banking Methods
Improvement of Online Usability

Company Profiles

INTRODUCTION
DEFINITIONS
Turnover (Sales)
Pre-Tax Profit
Profit Margin
Average Remuneration
Sales per Employee
FURTHER INFORMATION

BARCLAYS PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Codes
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

THE CO-OPERATIVE BANK PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Code
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

HSBC HOLDINGS PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Code
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

LLOYDS BANKING GROUP PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Code
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

MARKS and SPENCER FINANCIAL SERVICES PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Code
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

THE ROYAL BANK OF SCOTLAND GROUP PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Codes
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

SANTANDER UK PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Codes
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

TESCO PERSONAL FINANCE GROUP LTD

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Code
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

VIRGIN MONEY PLC

Previous Name(s) and Date(s) of Change
Principal Activities
SIC Code
Structure
Brand Information
Recent Developments
FINANCIAL PROFILE
Sales
Profits
Employees
Balance Sheet/Ratios

Further Sources

Associations
Publications
General Sources
Government Sources
Other Sources
Key Note Sources
Key Note Ltd

Understanding Consumer Survey Data

Number, Profile, Penetration
Social Grade
Standard Region

Key Note Research

The Key Note Range of Reports

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