New entrants to the UK banking market will have a fight on their hands to woo customers away from the security of their existing banks, with just 38% of consumers prepared to consider switching their current account to a brand new bank, according to research by financial comparison site uSwitch.
The research, conducted among a panel of 1543 adults, comes as the UK's traditional high street banks face up to the prospect of fresh competition from a clutch of new entrants, including Metro Bank, 'Project New Bank', Tesco Bank and Virgin Money.
While 57% of banking customers are looking forward to having a real alternative to existing high street banks, only 38% of those questioned by uSwitch would consider moving their main current account to a brand new bank.
Fully 31% of the sample are concerned that the new banks won't have enough knowledge or experience of banking and 11% wouldn't be confident that their money is safe. And while trust of existing banks is at a new low, over a third (34%) of people interviewed for the research say that new entrants would not be as established or secure as traditional banks.
Despite their reservations, consumers are highly critical of their current financial services providers, citing rubbish interests rates (73%), overcharging (74%) and penalising loyalty (61%) as their main gripes.
Dilshad Issa, personal finance expert at uSwitch.com, says: "Competition is certainly hotting up, but taking on the banking big boys won't be a walk in the park.
"But while consumers are cautious they also like the idea of the competition that new banks will bring. Initially, they might not want to move their main current account to one, but they will test the water with savings accounts and credit cards so there is still everything to play for."