54% of Brits would borrow through online-only bank

Almost a quarter (23%) would want both a digital and traditional bank with brick-and-mortar branches.

54% of Brits would borrow through online-only bank

More than half (54%) of Brits are comfortable applying for a mortgage online or via an app, without any human interaction or speaking to an adviser, according to research from NerdWallet.

 

This figure rose to 58% amongst 25 to 34-year-olds, and 68% among 35 to 44-year-olds.

The majority (77%) of the UK’s first-time buyer mortgage borrowers are aged between 25 and 44, according to the latest Office for National Statistics (ONS) data.

More than a quarter (27%) of those aged 45 to 64, and 41% of those aged 65-plus, said they would be comfortable taking out a mortgage online.

Three in five (60%) Brits said they would now consider a bank with no physical branches, and 40% felt prepared to have a digital-only bank as their only provider.

Almost a quarter (23%) said they would want both a digital and traditional bank with brick-and-mortar branches.

Although the research found that 28% were influenced to select a bank because of convenient access to a branch, 38% claimed they selected a bank based on convenient access online and 24% were influenced by the convenience offered through an app.

Denise Ko Genovese, senior personal finance expert at NerdWallet, said: “The shift to digital banking is very apparent and this trend is undeniably a contributing factor in bank branch closures.

"There is also an expectation as everything becomes more digital, for banks and other service providers to evolve to meet the modern needs of the public as well.

“24 hour and remote access, immediate transactions, ongoing budget tracking, and potentially quicker mortgage applications are just a few benefits online banking can provide, but we are in a time of transition and there is clearly still a role for physical branches in the banking landscape.

“A large percentage of younger adults are already comfortable applying for a mortgage online, but there is still more work for lenders to do.

"If banks can use their websites and apps to make more information and advice available, while smoothing out the application process, this can go some way to closing the mortgage knowledge gap for current and future generations, so that securing a mortgage online becomes second nature.”