Over half of Singaporeans want digital banks to offer non-financial features

But they would still keep traditional banks as their primary bank.

Sixty-six percent of Singapore customers expressed high interest in having their digital bank offer daily non-financial services, a report by PwC revealed.

Of those surveyed, more than half (54%) said that they wanted to be able to purchase plane, train and bus tickets using their virtual bank. The same proportion said that they want to be able to use their virtual banks for health care-related transactions such as illness consultation services.

Meanwhile, almost half (48%) hope to access coupons for shops and restaurants using their digital bank.

“To ensure their long-term success, it is critical for digital banks to have a strong proposition that goes beyond offering traditional financial services, but also engages with their customers on a more holistic level. This will be particularly important as customers are increasingly calling for integrated platforms that offer a full suite of lifestyle services,” said Sam Kok Weng, Singapore financial services leader, PwC.

“The challenge, though, is the ability of the digital banks to execute and bring to life their various offerings in a seamless platform with differentiated customer experiences,” he added.

Singaporeans notedly remain cautious in regards to opening a virtual bank account, with 40% of respondents to PwC’s survey indicated that they would only consider opening a bank account with a digital bank once it becomes popular and successful.

Interest is varied across the board with younger or over 70% of 18- to 39-year-olds and 70% high income groups indicating that they were ‘very interested’ or ‘interested’ in opening a digital bank account, the report noted.

Only 33% said that they would make digital banks their primary bank, with 67% indicating that they would still retain their existing bank as their main one.

However, customers expressed continued frustrations with traditional banks. Some of these issues included long queue times (42%), long wait times on the hotline (23%) and the inability to perform banking functions online (13%).

Customers with more pain points were more interested in opening a digital bank account. This figure was about half (53%) among respondents who had no pain points and rose to 77% amongst those that had three or more pain points.

In terms of financial features that would attract customers, the one that came on top was better rates on deposit and lending (49%) followed by quick and easy online customer service (42%) and a better mobile/digital experience (40%).

To attract more customers, PwC noted that digital banks should consider how they provide a human touch, including financial advisory services for more complex transactions, through digital channels.

Respondents indicated that human touch points were crucial in more impactful and complex situations such as emergencies (64%), wealth management (63%), mortgage (58%), and insurance (56%) transactions.

“Digital banks should put customers at the heart of what they offer. Having spectacular rates for example helps acquire customers in the short-run. But, to be successful in the long run, digital banks need to create ongoing engagement with their customers,” said Andrew Taggart, Southeast Asia Financial Services Consulting Leader, PwC.

“It will require banks to understand each customer and provide them with what they expect from personalised financial and non-financial products and services, through to a seamless customer experience,” he concluded.