When it comes to competing with big tech firms in banking, the key question is who customers will trust with their data and money, according to BBVA. Still, a new market forecast said Amazon, for example, could easily attract 70 million customers within the next five years.
Amazon could get 70 million banking clients?
Amazon’s banking services could grow to more than 70 million US consumer relationships over the next five years or so, Bain & Company has estimated. And it could avoid more than a quarter of a billion dollars in annual interchange fees in the US alone.
The bank Amazon partners with would probably hold deposits, while the company would design customer experience and distribution, the report said. This would help the tech giant avoid dealing with bank regulatory compliance and managing the balance sheet.
Big tech firms wouldn’t “eat the banks alive”
Press reports that big tech firms are going to erode the value of banking or they will “eat the banks alive” are simply nonsense, says Derek White, global head of customer and client solutions at BBVA.
He said the difference between banking and big tech firms comes down to a circle of trust – who do customers trust to manage their data and money best. Banking gets far fewer customer interactions than big techs, but they are typically higher value both monetarily and emotionally, he added.
Consumers fail to spot spoof banking apps
About 14% of UK responders couldn’t recognize a fake mobile banking app interface and 65% thought the official banking app was the fraudulent one, according to a survey by internet security firm Avast.
Approximately 77% of respondents said that they are more worried about having money stolen from their online bank account than losing their wallet or purse, the firm said.
Digital-only banks seem to lose appeal
The global appetite for digital-only providers has declined by 11 percentage points to 63% in the second half of last year from the first half of the year, according to the latest research by RFi Group.
It said consumers are moving more towards the digital channels of traditional players. One of the advantages that traditional banks currently have is their perceived reliability when it comes to private data, RFi Group said.