DIGITAL-ONLY BANK ACCOUNT HOLDERS FORECAST: Here’s what’s driving digital-only bank account holder growth in the UK, US, and Canada

• Insider Intelligence publishes thousands of research reports, charts, and forecasts on the Banking industry. You can learn more about becoming a client here.
• The following is a preview of one Banking report, the Digital-Only Bank Account Holders Forecast. You can purchase this report here.

The coronavirus pandemic is driving up user growth among digital-only banks, but it has also ratcheted up long-standing pressures on them. Neobanks are facing increasing pressure to monetize as lockdowns have swept through the US, the UK, and Canada.

Business Insider Intelligence

Meanwhile, incumbent banks’ digital brands, known as direct banks, are dealing with competitive demands on the digitization front to retain market share against tech-savvy neobanks. Despite these risks, we forecast that both types of digital-only banks will see their account holder numbers rise between now and 2024. 

This report is based on eMarketer’s US, UK, and Canada Digital-Only Bank Account Holders Forecasts, compiled in June 2020. In it, we focus on the top five digital-only banks in each country by account holder numbers, and the factors specific to each bank that we think could impact account holder growth. (We do not break out individual banks for Canada, due to a lack of available data.)

In the Digital-Only Bank Account Holders Forecast report, Insider Intelligence explores the key international factors we expect to affect digital-only bank account holder growth across all three countries between now and 2024, both those we expect to drive up growth and those that we think may pose growth risks. We then zoom in on the US, the UK, and Canada individually, outlining country-specific factors that could affect digital-only account holder growth. Finally, we drill down on factors specific to each of the top five digital-only banks in the US and UK.

The companies mentioned in this report include: Ally Bank, Aspiration, BankMobile, BMO, Chime, CIBC, Customers Bank, Monese, Monzo, RBC, Revolut, Scotiabank, Simplii, Starling, Tandem, Tangerine, TD Bank, and Varo Money. 

Here are some of the key takeaways from the report:

• Despite some significant obstacles like pandemic-related losses, reduced VC funding, and falling interest rates, we forecast digital-only banks’ account holder numbers to grow between 2020 and 2024.
• Digital-only bank account holder numbers will increase across the US, UK, and Canada during the forecast period — the steepest increase will be for the US at a compound annual growth rate of 19.8%, versus 12.7% in the UK and 9.8% in Canada.
• Penetration (defined as the percentage of each country’s population who are digital-only bank account holders) will also rise in all three countries, but year-over-year growth will slow across all three markets.
• Chime will boast the highest number of account holders among US digital-only banks by the end of 2024, with 9.5 million. In the UK, Monzo will claim the top spot with 4.0 million account holders in the same period.

In full, the report:

• Gives an overview of the key trends we expect to see across digital-only bank account holder numbers in the US, UK, and Canada — and the key international factors (both risks and drivers) we expect to influence these trends.
• Examines key factors specific to the US, UK, and Canada that will drive up digital-only bank account holder growth for banks in each country.
• Explores the growth drivers unique to each of the 10 banks broken out in the forecast.

Interested in getting the full report? Here’s how you can gain access:

1. Join other Insider Intelligence clients who receive this report, along with thousands of other Banking forecasts, briefings, charts, and research reports to their inboxes. >> Become a Client
2. Purchase the individual report from our store. >> Buy The Report Here

Are you a current Insider Intelligence client? Log in and read the report here.