Until recently traditional banks were betting on innovative financial technology firms to change the industry. 

However, established technology giants like Amazon, Apple, Tencent and Alipay have emerged as the bigger, more immediate threat to banking as we know it.  

In its eighth annual study on customer loyalty in retail banking, Bain & Company partnered with Research Now to survey more than 133,000 consumers in 22 countries.

It found that across most countries at least half of respondents said they are open to buying a financial services product from a technology company. Not surprisingly this is particularly true in countries where the banking experience is more time-consuming and cumbersome. 

Lack of trust in Banks

For example, in India 91 percent of respondents expressed a willingness to run their finances through major tech firms. Interest is similarly high in countries that have long used non-bank payment systems, such as in China, where many consumers conduct financial transactions via WeChat.  Here, 88 percent of consumers said they would bank with a tech firm.

Technology companies have also earned a high degree of trust with consumers, according to the survey.  Among U.S. and U.K. consumers, specifically, PayPal and Amazon rank nearly as high as banks for trust with their money.

Too Small to be Noticed

While fintechs have innovative products they struggle to build brand recognition or a distribution model that attracts many customers. Large technology firms already have digital prowess, established brands, and customer access, which provide an almost unassailable advantage in extending their corporate brands into banking. 

Many also already sell payment services, credit cards and loans. Bain’s research also found that routine transactions done online or through mobile cost 20 times less than those that require bank staff. 

«It’s plausible they will offer a suite of retail banking services in the near future,» said Gerard du Toit, head of Bain’s Banking Practice and lead author of the report.  

Banks Must do Better

On the surface, it appears that mobile banking has plateaued. The reality is that consumer usage of banks’ mobile apps has stalled.  However, the survey found mobile usage of non-bank apps for financial transactions is actually on the rise. 

In China, for example, where mobile usage is enormous, 91 percent of respondents said they had used a third-party payment app, with the average user making nearly 10 payments over a seven-day period.