Where have all the digital bankers gone?
Help AccountingWEB map the leading contenders in online business banking by taking part in our annual software survey
In recent months, AccountingWEB has watched the competition between digital challenger banks intensify for a slice of the small business banking pie.
Even with all the incentives and innovation grants to encourage new players into the business banking market and the market disruptions we have seen this year, the big high street names are still estimated to control 85% of the market.
Part of that dominance was reinforced when some of the challengers were initially left off the lists of lenders approved by the British Business Bank for coronavirus loans.
That situation has changed since the coronavirus business interruption loans were first introduced, but old habits are difficult to break in business banking. The more popular, but equally contentious Bounce Back Loan Scheme (BBLS) subsequently drove many businesses back into the arms of their incumbent banks, who were charged with handing out BBLS to their customers.
The pendulum shifts back?
FreeAgent’s chief commercial officer Kevin McCallum has a ringside seat on this contest, as the cloud accounting software developer is now part of the NatWest Group. “The crisis shifted pendulum back to the more traditional banks,” McCallum told AccountingWEB. “In times of uncertainty, people are more comfortable that their money is safe in the bank.”
According to McCallum, NatWest and the other big banks were a bit like HMRC and put huge efforts into adjusting their services to the rapid changes imposed by the government’s response to the virus.
But what is remarkable from latest AccountingWEB software survey returns is the poor turnout so far from users of apps from the High Street banks. While businesses may be willing to approach them for Bounce Back Loans, are they really completely disconnected from the banks’ digital offerings?
The practice vote
Accountants in practice have also been outnumbered by business respondents in the ratings posted so far. Some of their votes have gone to the bigger digital banking players such as Tide and Starling, but the strongest contingent so far has come from Cashplus, with last year’s banking app award winner Countingup in pursuit.
The world of banking and fintech is incredibly fluid at the moment, with anecdotal evidence suggesting that the likes of Starling and Tide are thriving as businesses have gone digital during the Covid-19 crisis.
While AccountingWEB has been assessing the contenders based on publicly available sources, our helpful population of business accountants and practitioners can help us compile a more nuanced picture of UK digital banking adoption rates.
If you’d like to pat your digital bank on the back, or give a motivational kick to your banking provider, please take a few minutes to let us know what you think in our 2020 Accounting Excellence Software survey.
You might also be interested in
AccountingWEB’s interim Editor in Chief has been with the site since 1999 and returned to the editorial hot seat in March 2020 to lead the hunt for a long-term successor... Send a DM if you're interested! When not tending to the needs of AccountingWEB members and geeking out on their technology habits, he devotes much of his time to his oddball...