Table of Contents
Introduction
-
- Abbreviations
Executive Summary
-
- The market
- 48 million current account holders
-
- Figure 1: Number of active current account holders and number of current accounts, 2012
- Online banking is most frequently used channel
- 8 in 10 own a standard current account
-
- Figure 2: Type of current account held – main account only, 2011
- Market factors
- Economic environment and changing population altering the competitive landscape
- The validity of the free-if-in-credit model has come under debate
- More restrictions being placed on the use of basic accounts
- Ongoing efforts to stoke competition in the market
- Companies, brands and innovation
- 87% of Britons’ main current accounts held with the top five providers
-
- Figure 3: Share of main current account holder customer base, by banking group, April 2012
- Lloyds Banking Group brands provide a third of packaged accounts
-
- Figure 4: Share of main packaged account holder customer base, by banking group, April 2012
- No brand has achieved significant levels of trust or differentiation
-
- Figure 5: Attitudes towards and usage of brands in the current account sector, January and March 2012
- The evolving competitive landscape
- Who’s innovating?
- The consumer
- Important factors when choosing a current account
-
- Figure 6: Important Factors when choosing a current account, April 2012
- Use of current account benefits
- Account usage and the top providers
- Attitudes toward current accounts
- What we think
Issues in the Market
-
- How much of a threat are non-traditional current account providers?
- Why aren’t more consumers upgrading to packaged accounts?
- Is mobile banking important to consumers?
- Is the branch network still relevant?
- How can providers ensure they attract younger age groups?
Future Opportunities
-
- Supporting the youth with practical incentives
- Taking online banking to the next level
- A golden opportunity
Internal Market Environment
-
- Key points
- The concept of free-if-in-credit banking is under threat…
- …but free banking will not go down easy
- Banks putting more restrictions on the use of basic accounts
- On-going efforts to stoke competition in the market
- FSA keeping vigilant about current account mis-selling
- Despite low interest rates, overdraft rates have continued to move up
-
- Figure 7: Official monthly bank and building society overdraft interest rate, UK Inter-bank, three-month rate, and official bank rate**, April 2007-April 2012
Broader Market Environment
-
- Key points
- Squeeze on household incomes yet to dissipate
-
- Figure 8: Monthly change in RPI and average weekly earnings, January 2008-April 2012
- Rate of unemployment hovering above 8%
-
- Figure 9: UK unemployment rate, seasonally adjusted, January 2008-January 2012
- Uncertainty preventing consumer confidence from rebounding
-
- Figure 10: UK consumer confidence, March 1997-March 2012
- Changing population dynamics unfavourable to new business growth
-
- Figure 11: Size of the UK population, by age, 2001-20
- Seeking alternative routes to growing new business
Competitive Landscape
-
- Key points
- The evolving competitive environment
- Competition for 623 Lloyds branches
- New and potential entrants
- Metro Bank
- M&S Bank
- Virgin Money
- Tesco Bank
- NBNK
SWOT Analysis
-
-
- Figure 12: UK current account market – SWOT analysis, 2012
-
Who’s Innovating?
-
- Key points
- 123 current account from Santander
- Barclays launches a DIY current account
- Pingit from Barclays
- Cash withdrawals now possible via RBS and NatWest mobile apps
Market Size
-
- Key points
- A well-established and slow moving market
-
- Figure 13: Number of active current account holders and number of current accounts, 2009-12
- Free-if-in-credit account has a stronghold on the market
-
- Figure 14: Type of current account held – main account only, 2011
- Just 16% own a packaged or premium account
Market Share
-
- Key points
- Barclays and NatWest close in on Lloyds TSB
-
- Figure 15: Main current account provider, by individual brand, April 2012
- The ‘big five’ provide 87% of Britons’ main current accounts
-
- Figure 16: Share of main current account holder customer base, by banking group, April 2012
- One in three packaged accounts provided by LBG
-
- Figure 17: Share of main packaged account holder customer base, by banking group, April 2012
Companies and Products
-
- Key players
- Barclays
-
- Figure 18: Barclays’ current account range, June 2012
- Figure 19: Range of packs available for the Barclays bank account, June 2012
-
- Figure 20: Range of packs available for the Barclays Premier current account, June 2012
- Figure 21: Barclays’ current account range continued, June 2012
- Figure 22: Key financial data for Barclays Plc (UK Retail Banking Division), 2010-11
- HSBC/First Direct
-
- Figure 23: HSBC’s current account range, April 2012
- Figure 24: First Direct’s current account range, April 2012
-
- Figure 25: Key financial data for HSBC (UK Retail Banking division), 2010-11
- Lloyds Banking Group
-
- Figure 26: Lloyds TSB current account range, April 2012
- Figure 27: Halifax/Bank of Scotland current account range, April 2012
-
- Figure 28: Key financial data for Lloyds Banking Group (Retail Division), 2010-11
- Nationwide
-
- Figure 29: Nationwide’s current account range, April 2012
- Figure 30: Key financial data for Nationwide, 2010-11
- RBS/Natwest
-
- Figure 31: RBS’ current account range, April 2012
- Figure 32: NatWest’s current account range, April 2012
- Figure 33: Key financial data for RBS Group (UK Retail Banking Division), 2009-11
- Santander
-
- Figure 34: Santander current account range, April 2012
- Figure 35: Key financial data for Santander UK (Retail Banking Division), 2009-11
Brand Communication and Promotion
-
- Key points
- Total adspend up by 6% in the year to April 2012
-
- Figure 36: Advertising expenditure on current accounts and related services, by product sub-category, 2010-12
- Adspend highly concentrated among a handful of big name advertisers
-
- Figure 37: Top ten advertisers of current accounts and related services, 2010-12
- TV and press top advertising medium used
-
- Figure 38: Share of advertising expenditure on current accounts and related services, by media type, 2012
- Ordinary current account adspend dominated by Santander and Halifax
-
- Figure 39: Top ten advertisers of ordinary current accounts, 2010-12
- Barclays the main advertiser of packaged accounts
-
- Figure 40: Top five advertisers of packaged/premium accounts, 2010-12
- Current account ads found to be breaching FSA standards in 2011
- Note about NMR data
Brand Research
-
- Brand map
-
- Figure 41: Attitudes towards and usage of brands in the current account sector, January and March 2012
- Correspondence analysis
- Brand attitudes
-
- Figure 42: Attitudes towards brands in the current account sector, January and March 2012
- Brand personality
-
- Figure 43: Brand personality for providers in the current account market– macro image, January and March 2012
-
- Figure 44: Brand personality for providers in the current account market– micro image, January and March 2012
- Brand experience
-
- Figure 45: Brand usage for providers in the current account market, January and March 2012
- Figure 46: Satisfaction with brands in the current account market, January and March 2012
-
- Figure 47: Consideration of brands in the current account market, January and March 2012
- Figure 48: Consumer perceptions of current account brand performance, January and March 2012
-
- Figure 49: Current account brand recommendation – Net Promoter Score, January and March 2012
- Brand index
-
- Figure 50: Current account brand index, January and March 2012
- Figure 51: Current accounts brand index vs. recommendation, January and March 2012
- Target group analysis
-
- Figure 52: Target groups, January and March 2012
-
- Figure 53: Current account brand usage, by target groups, January and March 2012
- Group One – Conformists
- Group Two – Simply the Best
- Group Three – Shelf Stalkers
- Group Four – Habitual Shoppers
- Group Five – Individualists
Channels to Market
-
- Key points
- The multi-channel approach to account distribution and administration
- Branch network is still highly relevant
-
- Figure 54: Number of branches belonging to the largest current account providers (shown on group basis), year-end 201
- ATM network helps to reinforce the brand
-
- Figure 55: Number of ATMs belonging to the largest current account providers (shown on group basis), 2010
- A third of Britons use online banking at least once a week
-
- Figure 56: Channels and frequency used to access banking services, 2011
- Use of online banking focused on simple daily account management
-
- Figure 57: Methods used to access banking services, 2007-11
- Use of mobile banking on the rise
-
- Figure 58: Use of mobile banking services, 2010 and 2011
Current and Packaged Account Ownership
-
- Key points
- Large majority of adults own standard current accounts
-
- Figure 59: Type of current account held – main account only, 2011
- The consumer resistance to upgrading
- Emphasising the value proposition in challenging economic times
- Just over two fifths have two or more accounts
-
- Figure 60: Trends in current account ownership, 2007-11
- Fee-based packaged account ownership in detail
-
- Figure 61: Ownership of fee-based packaged and free/ordinary current accounts, April 2012
- 25 to 44-year-olds the most likely to own a packaged account
-
- Figure 62: Type of current account held, by gender and age, April 2012
- Packaged account ownership positively correlated with affluence
-
- Figure 63: Type of current account held, by socio-economic group, April 2012
- Figure 64: Type of current account held, by gross annual household income, April 2012
Important Factors when Choosing a Current Account
-
- Key points
- Quality of online banking service is now a key selling point…
-
- Figure 65: Important Factors when choosing a current account, April 2012
- … but the branch is still relevant
- Most consumers take three or more factors into consideration
-
- Figure 66: Repertoire of important factors when choosing a current account, April 2012
- Packaged account holders expect to receive great deals
-
- Figure 67: Important factors when choosing a current account, by type of account owned, April 2012
- The influence of gender and age
-
- Figure 68: Important Factors when choosing a current account, by gender and age, April 2012
- Incentivising youngsters to spread the word
- Affluent less concerned about branch proximity
-
- Figure 69: Important factors when choosing a current account, by socio-economic group, April 2012
- Figure 70: Important factors when choosing a current account, by gross annual household income, April 2012
Use of Current Account Benefits
-
- Key points
- Access to account benefits by type of account owned
-
- Figure 71: access to account benefits, by type of current account, April 2012
- Packaged account benefit usage rates
-
- Figure 72: Ownership and use of benefits – fee-charging packaged account customers only, April 2012
- Positive correlation between use of benefits and cost of account
-
- Figure 73: Benefits actually used, by type of current account, April 2012
- Relevance of certain benefits varies with age
-
- Figure 74: Account benefits actually used, by gender and age, April 2012
- Impact of affluence is less significant
-
- Figure 75: Account benefits actually used, by socio-economic group, April 2012
- Figure 76: Account benefits actually used, by gross annual household income, April 2012
Top Providers and Account Usage
-
- Key points
- Lloyds TSB customers have access to the most benefits
-
- Figure 77: Access to current account benefits, by most popular main current account provider, April 2012
- Benefit usage rates highest among Lloyds TSB and Barclays customers
-
- Figure 78: Benefits actually used, by main current account provider (top seven only), April 2012
- Top providers and important factors when choosing an account
-
- Figure 79: Important factors when choosing a current account, by main current account provider (top seven only), April 2012
- Nationwide customers most satisfied with their current account
- Halifax customers most likely to feel loyalty is being rewarded
-
- Figure 80: Agreement with statements about current accounts, by main current account provider (top seven only), April 2012
Attitudes towards Current Accounts
-
- Key points
- Most are happy with existing account despite many feeling unrewarded
-
- Figure 81: Agreement with statements about current accounts, April 2012
- Packaged accounts give providers more opportunity to reward loyalty
-
- Figure 82: Agreement with statements about current accounts, by type of account, April 2012
- The young and affluent are most positive about their accounts
- Two thirds would switch if their bank started to charge a monthly fee
-
- Figure 83: Agreement with statements about current accounts, April 2012
- Attitudes toward alternative providers of current accounts
-
- Figure 84: Agreement with statements about current accounts, April 2012
- Figure 85: Agreement with statements about current accounts, by type of account, April 2012
- Affluent young men most open to branchless banking
- Banks should remain wary of the threat from non-traditional providers
Targeting Opportunities
-
- Key points
- Key target groups
-
- Figure 86: Key current and packaged account target groups, April 2012
- Feel undervalued
- Passively loyal
- Branch access
- Happy but demanding
- Passively loyal the most likely to own a packaged account…
-
- Figure 87: Current and packaged account target groups, by type of account, April 2012
- … and the most likely to use its benefits
-
- Figure 88: Current and packaged account target groups, by use of current account benefits, April 2012
- The importance of keeping things fresh
- Target groups and what they look for in an account provider
-
- Figure 89: Current and packaged account target groups, by important factors when choosing a current account, April 2012
- Target groups and the major providers
-
- Figure 90: Current and packaged account target groups, by main current account provider, April 2012
Appendix – Brand Research
-
-
- Figure 91: Brand usage, March 2012
- Figure 92: Brand usage, January 2012
-
- Figure 93: Brand commitment, January and March 2012
- Figure 94: Brand momentum, January and March 2012
-
- Figure 95: Brand diversity, January and March 2012
- Figure 96: Brand satisfaction, January and March 2012
-
- Figure 97: Brand recommendation, January and March 2012
- Figure 98: Brand attitude, January and March 2012
-
- Figure 99: Brand image – macro image, May 2012
- Figure 100: Brand image – micro image, January and March 2012
-
- Figure 101: Profile of target group, by demographic, January and March 2012
- Figure 102: Psychographic segmentation, by target groups, January and March 2012
-
- Figure 103: Brand usage, by target groups, January 2012
- Figure 104: Brand usage, by target group, March 2012
- Brand index
-
- Figure 105: Brand index, January 2012
- Figure 106: Brand index, March 2012
-
Appendix – Market Share
-
-
- Figure 107: Type of current account held, by main account provider (top seven only), April 2012
- Figure 108: Most popular main current account provider, by demographics, April 2012
-
- Figure 109: Next most popular main current account provider, by demographics, April 2012
-
Appendix – Current and Packaged Account Ownership
-
-
- Figure 110: Ownership of fee-based packaged and free/ordinary current accounts, by demographics, April 2012
-
Appendix – Important Factors when Choosing a Current Account
-
-
- Figure 111: Most popular factors when choosing a current account, by demographics, April 2012
- Figure 112: Next most popular factors when choosing a current account, by demographics, April 2012
-
- Figure 113: Repertoire of important factors when choosing a current account, by demographics, April 2012
-
Appendix – Use of Current Account Benefits
-
-
- Figure 114: Use of current account features, by demographics, April 2012
- Figure 115: Use of current account insurance and warranty cover, by demographics, continued, April 2012
-
- Figure 116: Use of current account security/protection features, by demographics,continued, April 2012
- Figure 117: Use of other current account benefits, by demographics, continued, April 2012
-
- Figure 118: Repertoire of use of current account benefits, by demographics, April 2012
-
Appendix – Attitudes Towards Current Accounts
-
-
- Figure 119: Agreement with statements about current accounts, by type of account, April 2012
- Figure 120: Agreement with statements about current accounts, by main current account provider, April 2012
- Figure 121: Important factors when choosing a current account, agreement with statements about current accounts, April 2012
- Figure 122: Agreement with statements ‘I’d be happy to hold my current account with a bank with no high street branches’ and ‘All banks are pretty much the same as each other’, by demographics, April 2012
-
- Figure 123: Agreement with statements ‘I’m happy with my existing current account’ and ‘I feel that my bank rewards my loyalty’, by demographics, April 2012
- Figure 124: Agreement with statements ‘Non-traditional firms such as supermarkets would do a better job at running current accounts than banks’ and ‘I would switch current accounts if my bank introduced a monthly fee’, by demographics, April 2012
-
Appendix – Targeting Opportunities
-
-
- Figure 125: Key current and packaged account target groups, April 2012
- Figure 126: Target groups, by demographics, April 2012
-
Back to top