Challenger banks soaring ahead of incumbents, according to savings customers

UK challenger banks are significantly outperforming traditional banks when it comes to trust, according to research conducted by Hampshire Trust Bank (HTB).

A recent survey of our personal savings customers revealed that 63% find challenger banks more trustworthy than the big five high street banks. These findings suggest that competition from challenger banks is improving customer choice and driving innovation in the UK banking market, encouraging the emergence of new players with a range of different propositions and business models.

This research provides a snapshot of the concerns, opinions and priorities among HTB personal savings customers. The survey findings also indicate that trust in banking has improved since the financial crisis of 2008. We have a responsibility to represent our personal savings customers in areas where working together can provide added value and enhance good customer outcomes. In the highly competitive banking sector, we are accustomed to the challenger versus incumbent narrative, so it is encouraging to hear that challenger banks are proving themselves as trustworthy, specialist and relevant in this evolving landscape.

Despite the initial excitement surrounding Open Banking and the opportunities it presents for the industry and consumers, our survey revealed that 65% of savers are not familiar with the concept. Furthermore, only 5% of respondents would be prepared to share their data with Open Banking. This suggests that the benefits of this initiative need to be clearly communicated so customers can understand how sharing their financial data can provide transparency, convenience and tailored products at a lower cost, all without compromising the safety of their personal data and money.

Looking ahead, when asked about the most effective savings options and investment strategies over the next five years, 71% of respondents selected cash savings, 15% selected equities and 4% selected property investments. The survey also revealed that 55% of respondents claim that Brexit will not affect their approach to saving and spending.

At HTB, our personal savings accounts are designed to be straightforward and consistently competitive, giving you the reassurance that you will not have to keep moving funds around to get a good deal and helping you get great value from your savings. Find out more here.

HTB would like to reassure customers that we are operating normal business hours, 9am to 5pm Monday to Friday with no interruptions to our service. Click here for more information about our response to COVID-19. Please get in touch here, or via your usual method should you have any concerns.