Digital challengers leave incumbents trailing in Best British Bank awards

Digital challengers leave incumbents trailing in Best British Bank awards

App-only newcomers Starling Bank and Monzo took the top spots in Smart Money People's 'Best British Bank' awards, bringing an end to First Direct's three-year reign and leaving traditional incumbents trailing in their wake.

The British Bank Awards, run by the consumer review website Smart Money People, polled over 24,000 UK consumers to help find the UK’s best and worst financial providers.

With the exception of HSBC offshoot First Direct, the top five providers all hailed from outside the traditional banking sector, with Starling Bank topping the poll, followed by Monzo, First Direct, Nationwide and Virgin Money. Alongside the Best British Bank acoclade, Starling also walked off with the award for best current account provider.

NatWest is the only bank to see its overall position improve, rising to sixth place, and also taking home the ‘Best Banking App’ award.

The remaining UK banking heavyweights all slid down the table, with the wooden spoon handed out HSBC joint venture M&S Bank, which saw its customer satisfaction score plummet from 70.6% in 2017 to 56.3% in 2018, with its current account in particular coming in for criticism from consumers.

The 2018 Banking League Table:

  1. Starling Bank
  2. Monzo
  3. First Direct
  4. Nationwide Building Society
  5. Virgin Money
  6. NatWest
  7. The Co-operative Bank
  8. Halifax
  9. Santander
  10. TSB

Comments: (3)

Robert Fillmore
Robert Fillmore - Sensibill - London 05 March, 2018, 11:001 like 1 like

Notably, Natwest broke the trend winning best bankig app. A great achievement when up against the digital only banks.

Giles Sergant
Giles Sergant - Consultant - Newcastle Upon Tyne 05 March, 2018, 12:10Be the first to give this comment the thumbs up 0 likes

After 3 or 4 years hard effort, which in some cases included an unrelenting fight just to stay in the game, it’s encouraging to see a number of indicators pointing to meaningful traction amongst the first wave of challengers (Class of 2014/5).

The developments in the past 5 years of the Fintechs and Challengers with ambitions in the UK retail banking market have acted as zero investment proof-of-concepts for the CMA9.  The so called ‘disrupters’ have usefully proved customer demand for new elements that can add value to banking apps.  These include the ‘pulse’ balance line (Monzo), card freezing (Revolut), the aggregated ‘single customer view’ (Tandem) and not least the ‘Marketplace’ concept (Starling).

In 2018 we’re just starting to see big banks following along with Barclays card freezing, Lloyds doing account aggregation, HSBC integrating FPM and First Direct moving towards a ‘marketplace’ model.  Fair to say that PSD1 has proved some moderate success here as they would never have got there that quick.

Looking on: the UK’s premature entry into Open Banking is likely to give the Challengers even more of a boost.   The CMA9 are getting increasing lost in the squabble around how an unknown, untrusted and frankly unwelcomed TPP can be consented and then access the ASP's customer account.  It’s one that will continue to distract for the 18 month clock that is now running since the EP&C approved the key Technical Standards for Open Banking last week.

This is a real opportunity for the Challengers (non-CMA9) to compound their momentum over the incumbents by concentrating on a more collaborative approach with symbiotic FinTech alliances that are able to become PSD2 compliant by September next year.  This is cutting a much happier path and one that in time the bigger banks are likely, again, to follow.

 

Raymond Lee
Raymond Lee - Intertrust - Reading 06 March, 2018, 08:38Be the first to give this comment the thumbs up 0 likes

And yet, only yesterday on this very website we read that digital banks are losing their appeal - https://www.finextra.com/newsarticle/31769/digital-only-banks-losing-their-appeal - and whilst awards are nice, they don't make up for the fact people perceive the traditional banks as being a safer place to keep their money and protect their data. I, probably like most here, have accounts wiht a lot of the new digital entrants but still revert back to a traditional bank for my main banking transactions. They've a way to go yet. 

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