Digital-only financial providers (such as neobanking platforms like Monzo, Starling Bank and Revolut as well as fintechs like Klarna), expanded their overall reach from 16% of adults back in 2018 to a significant 50% in 2024 according to research from RFI Global, the data and insights firm focusing on financial services.
RFI Global’s UK banking research study has surveyed 4000 consumers aged 18 years and above during December and January 2025 regarding evolving financial product holdings, behaviors as well as preferences.
Although traditional banking institutions continue to dominate financial services, considerably more consumers have their main debit card with a neobank and reportedly spend 20% more than consumers with a primary debit card from a Big Six bank.
RFI’s research reveals that consumers holding their primary debit card with a neobank increased from 1% at the end of 2020 to 9% towards the end of 2024, and the share of market for the Big Six banks declined from 85% to 71% during the same period.
Hubert Petka, Group Director at RFI Global said:
“Everywhere you look neobanks are becoming a bigger part of the system. They are popular among younger generations such as GenZ and millennials who value their advanced digital capabilities and convenience. Yet banks remain resilient as they increase their agility and consumers continue to use their cards, alongside cards from neobanks, to meet their day to day needs. Nonetheless, neobanks are poised to grow in the years to come and could really threaten the dominance of the incumbent players over the next decade.”
It used to be the case that consumers were more likely to get divorced than change their primary banking service provider.
UK consumers are more likely to switch banks in order to utilize attractive deals and to access rewards like cash bonuses, interest and other benefits.
Of the consumers who are seriously considering switching their main current account in the next year, half said they are considering switching to access an incentive or that the other provider provides better rewards.
Petka added:
“Amidst fierce competition, banks have ramped up their efforts to win over consumers. These attractive rewards are reshaping the landscape of consumer loyalty and engagement. Yet with the majority of consumers lacking access to any loyalty perks through their main banks and dissatisfied with their current rewards proposition, there is still more that could be done by financial providers to attract and retain customers,” concluded RFI’s Petka. “As consumer expectations continue to shift, all financial institutions need to pay attention to the nuances of these trends.”
Almost half (49%) of UK consumers are now dipping into their savings to cover increasing household expenses as well as unexpected costs, the highest amount for more than a decade.
Another quarter (27%) said they will have to access more credit this year to cover continued rising costs – opening additional credit cards or using BNPL.
Of the 43 million consumers in the UK who save (80% of the banked population), over one third – mainly millennials aged between 27 and 42 years – have “less than £1,000, and 29% have less than £500, in their savings accounts.”
And the top 25% of savers, largely retired baby boomers, reportedly have average savings of £91,500.
Petka also stated:
“Despite rising intentions to save for a rainy day, consumers struggled to save last year and turned to savings to cover a higher cost of living. New savings account openings, which followed a rise in interest rates, have now tapered off and the average balance in the main savings account has reduced by a third.”