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UK banks will need to approach 2023 with customer compassion,鈥攐r risk losing their base to more generously paying neobanks. This article originally appeared in Insider Intelligence鈥檚 Banking Innovation Briefing鈥攁 daily recap of top stories reshaping the banking industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily. Are you a client? Click here to subscribe.

We expect nearly 84% of the US population will use digital banking by 2027, per our forecasts. Regional banks on the hunt for new customers and more deposits must develop marketing strategies to attract younger consumers.

Debit card rewards programs are hard to come by, mainly only offered by smaller fintechs or neobanks. But customers highly value rewards. This should attract prospective debit cardholders, especially since the card is coming from a trusted issuer that consumers may already have a relationship with.

US Census Bureau.

The network is missing some of the most popular P2P apps like Cash App, which has 52.9 million US users. It also does not yet connect to digital wallets like Apple Pay and its 48.7 million US users or Google Pay鈥檚 26.4 million US users. This article originally appeared in Insider Intelligence's Payments Innovation Briefing鈥攁 daily recap of top stories reshaping the payments industry.

Bank of America leads US banks in Instagram followers: Social media鈥檚 influence on Gen Z鈥檚 financial behavior underscores its importance in marketing campaigns.

How does headless banking differ from BaaS and neobanks? Headless banking dispenses entirely with the conventional banking infrastructure. That鈥檚 not the same as Chime or MoneyLion, for example, which serve as an alternative to traditional banks. They concentrate on offering a user-facing experience and rely on partnerships with licensed banks like Bancorp or Pathward to hold deposits and issue cards.

The number of digital-only bank account holders will reach 6.0 million in 2023 and will grow to 7.8 million by 2027, according to Insider Intelligence鈥檚 digital-only bank account holders forecast. Mobile banking app usage is heavy. There will be 15.9 million mobile phone banking users in Canada this year, or 49.5% of the adult population.

Neobanks like Revolut target a younger demographic, which typically gives them lower-balance customers than larger institutions. This characteristic could predispose neobank customers to be attracted to deals and discounts, causing them to act on ads at a higher rate. Weaknesses. Neobanks are often not customers鈥� primary provider, leading to lower customer engagement than traditional FIs.

The recent shocks to the US financial system will undoubtedly create a ripple effect for consumers, with many zoning in on what these banking failures mean for their own bank accounts and whether the current state of banking is viable or trustworthy as it now stands.

Neobanks like Brex, Mercury, NorthOne, they've really benefited a lot from this. And I do think it is very interesting though because those neobanks, they don't actually have banking trotters themselves, so they're backed by usually smaller banks that provide the banking services for them. That is something to think about.

Retail media ad spend is on track to claim nearly 1 in every 5 dollars spent on US digital advertising in 2024, as advertiser demand for first-party data fuels growth. Verticals outside of retail are taking notice and adapting the retail media playbook in order to monetize their own first-party data. What is commerce media?

Though 92% of banking customer respondents said they have an account at a traditional bank, 46% of bank customers also have an account with a digital-only bank. Consumers also don鈥檛 necessarily believe their financial lives need to exist at banks.

Our take: Black FIs also face competition from new banking entrants like fintechs and neobanks. But the new challengers may not be all bad. Many affinity-based fintechs and neobanks build their operations around community and support the 鈥淏ank Black鈥� movement.

It's already gotten that started by transitioning it's branded prepaid cards into essentially neobank checking accounts. So it's got a lot going on there. And it does have Walmart Pay, which it may not be used to the extent that Apple Pay is used, but I think you do have some Walmart Pay loyalists that have bought into Walmart Pay. It's not just dead on arrival.

If you enjoy this podcast, please leave us a review and give us a five-star rating. We'd love to hear from you. The title of today's episode is Money 20/20 in 2023, and that's because we're on the floor of Money 2020 in Las Vegas recording this episode. So if you hear noise in the background, that is why.

On today鈥檚 podcast, we are talking about digital account-opening trends, who鈥檚 opening bank accounts digitally, and what they want or expect when going through that process. Here鈥檚 a look at what we鈥檙e talking about this week: 鈥� In our 鈥淗eadlines鈥� segment, we discuss how in-flight deposits and Gen Z will drive account openings in 2023 and to what extent new account openings are the result of high deposit rates and an incentive-laden environment. 鈥� In 鈥淪tory by Numbers,鈥� we examine how being able to set up direct deposit when consumers open checking accounts is extremely important and the importance of deposits being protected. 鈥� In 鈥淔or Argument鈥檚 Sake,鈥� we suppose there鈥檚 a new US banking regulation requiring all banking products to be applied for and opened online. We debate (nicely) how the industry dynamics would change if everything in banking were digitized and moved online. Tune in to the conversation with host Rob Rubin, managing principal of financial services consulting at EPAM Systems Alex Jimenez, and our analyst Tiffani Montez.

Follow us on Instagram. Episode Transcript:. Rob Rubin:. Hello and welcome to the Banking and Payment Show. A Behind the Numbers podcast from eMarketer. Today is March 7th. I'm Rob Rubin GM of Financial Services here at Insider Intelligence and your host. If you enjoy this podcast, please give us a five star rating and subscribe. The title of today's episode is Fintech Investment Trends 2023.

The first one, Tiffani, you're on deck to present this first one to us, risky Banking as a Service partnerships will test the trust between FIs, financial institutions, and fintechs. Talk to us about this. Tiffani Montez:. One of the things that we are noticing in the industry is that we believe that banking, as a service, partnerships, are having their own Milli Vanilli moment.

We own about 50,000 in the US and we touch about another 250,000 in the us. So we touch about 300,000 ish. So if you break that 500,000 up, about 125 are in bank locations, and the rest are in retail locations. So it's still a very sort of vibrant retail-based ATM economy out there. And so we've got a lot of independent operators running machines, and then banks operating machines as well.

I think there's a lot of thinking and a lot of talking, and there's increasingly a lot of doing when it comes to targeting this segment of the US population. The Gen Zs who are in that credit marketable universe, it's about 10% of the US population, and it's growing as society ages out and demographics shift.