Online banking is now a mainstream access method for retail customers on both sides of the Atlantic, but this has not led to a decline in the use of branch-based services and has actually resulted in higher take-up of other channels such as ATMs, according to a study by analyst house Gartner.
A survey of over 2000 adults found that 33% of US customers - the equivalent of 71 million people - regularly use Web banking services. The UK numbers are not as high, but the survey shows that 26% of customers - around 14 million adults - now bank online.
"The current usage levels in both countries show that adoption is now taking place within the mainstream of consumers, among people who use new channels and services if, and only if, they see intrinsic value from the new technology," says David Schehr, research director for Gartner's financial services research team. "Online banking has clearly made this transition in consumer minds."
Gartner says one of the key findings of the survey is that use of Web banking does not lead to a substantial decline in visits to branches. Furthermore, net banking is actually linked to higher use of other channels like ATMs and telephone banking.
The results also show that younger customers and high-income earners are most likely to use the Internet for their banking.
Gartner says the mainstream adoption of Web banking shows that banks need to stop treating the Internet as a distinct delivery channel. Instead, they should use the Web to improve customer communication and differentiate themselves from competitors.
"Banks and other financial services providers must now rethink the role of online banking within this context, and leverage this channel to serve their clients and strengthen relationships," adds Schehr.
The analyst house also calls on banks to improve channel integration as customers want consistency across different service channels and business units.
This echoes a European study conducted by TNS on behalf of Fujitsu Services last year which found that integration between the Internet bank and branch banking channels is key to improving the customer experience.
The research, which was released in November and examined the experiences of 2500 retail banking customers across Europe found that customers want the convenience and choice of the Web, integrated seamlessly with face-to-face contact in high street branches.
Meanwhile a UK study released in the same month by Forrester Research found that, after a steady take-up of online banking services between 2000 and 2005, growth has slowed in the last two years and is set to remain sluggish as customers stick to using branches and ATMs.