Megan Carnegie is a journalist and editor. She has written for Courier, Time Out, Guardian Weekend, Creative Review, The Telegraph, Evening Standard, and more. Outside of work, she can be found reading, running, and killing off her houseplants.

Once a signifier of luxury or novelty, custom products and services are now within reach of the everyday consumer, thanks to the rise of artificial intelligence, algorithm-led platforms, and the COVID-era digitisation boom. Today, everyone wants to be the main character of their brand experience. 

Personal Worlds

A Monzo account for day-to-day spending, HSBC’s Kinetic for self-employed business income, a Nationwide ISA for one savings bucket, a Marcus by Goldman Sachs instant-access account for another savings bucket, and Nutmeg for diversified investments. This smorgasbord of financial tools could easily represent the average UK banking consumer – gone are the days when people had one account for all assets that was accessible via the local bank teller. “Having all your eggs in one basket went out the window when the global financial crash happened,” says Brean Horne, personal finance expert at NerdWallet. “People want to make sure they’re able to access the money as and when they need it, so they’re much more open to having it spread across different institutions.” 

Interview with Brean Horne, conducted by the author

These fractured financial relationships are now a mainstay in the consumer banking landscape, with just under a third of Britons (31%) holding two bank accounts. Some 19% have three, while one in 10 (12%) have four or more bank accounts. There are a number of reasons driving this fiscal promiscuity – a quarter seek an improved digital offering (23%), while 24% want better customer service. 

KPMG

 To secure the benefits, interest rates, and features they want, people are taking a hybrid approach to banking, and segmenting their financial lives across a wide range of providers.

“Their focus is to curate and tailor their finances around what suits them,” says Horne. “With the pandemic, some Britons have had a big shock to their financial lives, while others have had time for introspection and to work out exactly what they need.” 

 With legacy banks playing catch-up to the ease and transparency of digital challengers like Monzo and Starling, consumers can ‘try on’ a bank for size with just the click of a button – so perhaps it’s no surprise this kind of promiscuity has emerged. As the notion of a bank as a static storage place erodes, how can brands cater to this segment of savvy savers and their penchant for playing switcheroo?

From plug-in apps to legacy and neobanks, British consumers are spoilt for choice when it comes to financial options. But why settle for just one, when you could try them all? More than one in three are happy to use a variety of financial companies to fit their different needs, and more than half of those with a neobank would actively prefer using different companies for different needs. 

EPAM

 Challenger bank users are more inclined to adopt the pick-and-mix approach: 65% of Monzo users, 67% of Revolut users, and 81% of Starling customers prefer to have multiple accounts, compared to 49% of Britons as a whole. 

YouGov

“Digital challenger banks have done impactful work in showing people they can have control over their finances,” says Horne. “Previously, the financial world was a mystery, but this new generation of banks have been transparent and made customers feel part of the process, which has erased all the smoke and mirrors traditional banks have had to struggle with.” 

 Despite almost a decade passing since the financial crash, in the spring of 2022, under a fifth of Britons trusted traditional banks. 

YourMoney

 Legacy high- street banks occupy the half of the bottom 10 performers, but it’s only the pure digital banks Starling Bank and Monzo which appear in the top 10. Starling Bank is the stand-out performer and is almost equal to second-place Nationwide. 

Consultancy

Particularly with cash usage declining in the UK – it dropped by 40% across 2020, compared to 2019 – people no longer see banks as a static storage place for their money, but a dynamic pot that helps their money, and financial literacy, grow. 

Opay

 However, Britons still aren’t maximising their options, because of a lack of information and perception that opening a new account will be time-consuming. A quarter of Britons say they don’t have time, or it’s too complex to switch accounts – despite it taking on average just 30 minutes. 

Virgin

 Whether a challenger or a traditional bank, appealing to time-pressed Britons who are open to multiple solutions is the sweet spot to aim for.

As high street banks close, engaging consumers digitally is vital

Traditional high-street banks play catch-up with digital disruptors

“Consumers, particularly tech-savvy consumers, Gen Zers and Gen Yers, are tired of the bureaucracy, the complications, and the cost of dealing with traditional banks,” says Alex Tedder, a fund manager at Schroders who specialises in disruption. “They are flocking to the challengers, many of which are providing an easy-to-use, cost-competitive service and doing this very effectively.” 

Schroders

 The pandemic and its restrictions only strengthened the case for adoption. Since March 2020, use of all digital banking services has increased, with two-thirds (66%) of Britons who’ve used digital banking services stating they have used mobile banking apps more often. The highest rise in usage for online web banking was among the 55 and over age group, with 60% using the service more often. 

UK Finance

 In parallel, Lloyds Banking Group announced the closure of 60 branches in the UK in March, with Nationwide scrapping eight of its freephone helplines. 

It’s a similar picture in the commercial sector. Mobile banking has become an important tool for small and medium-sized businesses (SMBs), and smartphone evolution provides increasing functionality many small businesses are finding helpful. “A lot of businesses are going to migrate to the new providers, such as 

 which offers not only good payment processing, but also data management and cash management services in a way that traditional banks can’t do,” says Tedder. 

 offer low fees and enable owners to integrate with main accounting and invoicing software, including Quickbooks, Xero, and Sage.

But the big banks are fighting back. NatWest launched its online business account 

 in 2018, and saw a five-fold increase in customers in 2021, which it attributes to an increase in sole traders and start-ups during the pandemic. 

Financial Times

, established in 2020, provides small business owners with a single platform to manage their financial tasks. 

Pymnts

 The same is happening in the personal account sector – taking on the likes of Monzo and Starling, JP Morgan’s Chase brand launched its first saver account in the UK, with a ‘market-leading’ 1.5% interest rate. 

Altfi

 And then there’s the age-old tactic of offering cold hard cash for users to switch accounts – HSBC has agreed to give new account holders £175, provided they deposit a certain amount within a set period of time. 

Express

Post-pandemic, mobile banking is on the rise as customers seek ease of use

“We expect banks to act like financial advisors… and give us a holistic outlook on our financial wellbeing and standing in real-time,” says Clare Lawson, CEO of experience at Ogilvy UK. “Based on the data [they hold], we anticipate banks to predict how much we will save each month in real-time, and how to shape our financial future.” 

The Drum

 Many already do – Monzo creates easy-to-digest spending reports and rounds up costs and puts them in a savings pot, as do Bunq and Starling. In fact, 32% of Britons appreciated having add-on budgeting tools, like rounding up and moving money into savings pots. 

NerdWallet

 “Having those extra, intuitive things built into what you do every day is important for people,” says Horne. “Although people want to prioritise finances as much as possible, the ease of these tools is key because after all, life gets busy.” 

By gathering the insights on spending behaviour (with a user’s permission of course), consumers have come to expect a 360-degree spending snapshot and tailored advice – accessed in the comfort of their own home, cup of tea in hand. A quarter of Britons rank quality of advice as their most preferred banking feature. 

Finder

 Many are willing to take time out of their day to access learning materials provided by (one of their many) banks, especially young people who are just at the start of their financial careers. Some 56% of Gen Zers say that financial education programs or seminars are very or extremely important sources of personal finance information. 

Investec

Embedded finance is an emerging alternative, and the UK is blazing a trail, with British brands expected to generate £230.48 billion from embedded financial services, 37% of the £619 billion total for European brands. 

Fintech & Finance News

 BNPL schemes like Klarna have paved the way for this and more sophisticated services are sure to follow suit. “Brands can tap into financial products without huge upfront costs, and create new commercial models,” says Tom Bentley, CCO at Vodeno. “By connecting with a bank via APIs and picking from an existing suite of products, they can offer incentives like discounts, points, or cash back linked to shopping habits and delivered through branded debit cards.” 

Interview with Tom Bentley, conducted by the author

 There’s opportunities to reach out to specific communities too; a Stipe-powered feature on 

 enables viewers to tip their favourite creatives, and Talenthouse provides tailored financial services for creatives with the help of Vodeno and Aion Bank. The service, called ElloU, will remove foreign exchange fees and offer income advances. 

The Fintech Times

Younger generations want to have their eggs in more than one ‘banking basket’

Banking that relates to human needs and experience

With branch activity at the lowest point ever, the need to engage consumers digitally has never been more important. Indeed, after security and digital apps, personal services like telephone and email are the most popular (26%) features offered by banks among Britons. 

 As financial interactions become increasingly complex, the real winners may be those who understand the emotions at play and do their best to mitigate that stress. Empathic banking is still a fringe practice, with only three in 10 banks being very confident they can sense customers’ emotional outlook about their financial situation without asking them directly. 

Accenture

 Hard to embed at scale, some are targeting niche professions and interest groups in empathic ways with add-ons and apps. 

 aims to serve the unique needs of professional musicians, while 

 “Beyond all of the technical features, banks should be looking to show their impact and how they can positively create a world people are looking to live in,” says Horne. 

Acknowledge that Gen Zers bank differently

“Neobanks and banks [generally] are still ‘one-size-fits-all’,” says Nafeesa Jafferjee, co-founder of Quirk, a financial-advisor app for youngsters. “But with the younger generation – because they were exposed to tech from the beginning – it’s like, what can they do for me and my lifestyle?” 

Sifted

’ for this younger cohort, with 64% of Gen Zers looking for a personalised banking experience. 

Market Talent

 caters to teens, and has an 800,000-strong user base after less than three years. More likely to engage with cryptocurrency, 18% of Gen Zers want their bank to provide support and advice on investing in digital currencies. “Gen Zers, and more of us in general, are engaging with social content more rigorously, so integration and personalisation of tools [on social] is important,” says Horne. 

 Indeed, social media is the go-to destination for almost a quarter (24%) of Gen Zers seeking financial advice, so banks have a new place to play and educate. 

BDaily

Integrate financial wellbeing in all aspects of life

The next generation wants money planning and management relevant to them. Striking the balance between entertaining and educational is not easy, but is more than possible. 

 encourage customers to save more through weekly challenges, while 

, the ‘AI assistant that grows your money’, has a rainy day savings feature that can put money aside every time it literally rains. Boosting financial wellbeing with gamification and behavioural nudges isn’t just fun and engaging, it works. Research by the US-based CommBank found that CBA customers who were prompted to consider making a credit card repayment with a series of nudges and shown information about the benefits of reducing their debt, repaid an average of $542 in the month after their tax refund. “The results highlight that proactively contacting customers in a targeted manner and at the right time can help them to follow through on their intentions and make meaningful progress towards their goals,” says CommBank’s chief data and analytics officer Dr. Andrew McMullan. 

Finextra

 of Britons appreciated having add-on budgeting tools, like rounding up and moving money into savings pots

 of Gen Zers want their bank to provide support and advice on investing in digital currencies

To secure the benefits, interest rates, and features they want, people are taking a hybrid approach to banking and segmenting up their finances across a wide range of providers

Britons no longer see banks as a static storage place for their money, but a dynamic pot that helps their money, and financial literacy, grow

With branch activity at the lowest point ever, the need to deliver people-centric features and engage consumers digitally has never been more important

Brean is a personal finance expert dedicated to helping people understand the (often) confusing world of finance. From managing the cost of living crisis, money-saving tips, insurance and investing to credit scores, homebuying, managing debt and scams, she covers a wide range of personal finance topics. Working with consumer finance platforms including Forbes Advisor, NerdWallet, Which?, and Moneywise, she has written news, features and advice guides as well as produced podcasts and videos to help people better understand their finances. She has also written for The Motley Fool and Citywire.

Tom Bentley is a member of the executive board and responsible for the commercial and marketing strategy in the development of 

United Kingdom

Money

Banking and payments

Interview with Brean Horne conducted by the author

Interview with Tom Bentley conducted by the author

Britons are chopping up their financial lives, distributing bits and pieces among a range of providers, trying to chase the best interest they can earn. As the notion of a bank as a static storage place erodes, how can brands cater to this segment of savers and their penchant for playing switcheroo?

Personal Worlds

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