Interest In Online Banking Flattens

Use of online banking in the US has levelled off according to a new survey from Ipsos Insight. The study suggests that fears about identity theft, along with concerns that companies are selling records to third parties, are stalling growth in the market.

The figures come from the Ipsos US Express, a weekend-turnaround telephone omnibus surveying 1,000 American adults between August 2nd and 4th. This is the third year of the company's study of online banking, and shows that the percentage of Americans banking online was unchanged (39%) during the 12-month period ending August 2005. Online banking among different demographics remains mostly unchanged, although use by those over 55 has decreased - to 21% from 26% in 2004.

Respondents displayed little trust in online banking:

• 83% of those who bank online reported concerns over protecting their personal information from theft
• 73% of people said personal information theft is a deterrent from using online banking
• 72% of respondents cited concerns about banks selling their personal information to a third party.

However, those who bank online are doing so more frequently, with users paying bills online 5.1 times a month (up from 5 in 2004), transferring funds 3.1 times a month (up from 2.5), and making balance enquiries 8.2 times a month (7.1).


Another online growth area is selling new products: half of new credit card applications and slightly more than half of mortgage applications were made online.

Doug Cottings, Senior VP of Ipsos Insight's Financial Services division, says that the industry needs to convey that it is addressing the issues of information protection and theft: 'With only 39% of Americans using online banking, there is tremendous market potential for banks that can allay customers' fears'.

Ipsos Insight, the flagship marketing research division of Ipsos in the US, is online at www.ipsosinsight.com.