Digital vs in-person banking: what do Northern Irish businesses prefer for lending products?

Shweta Bharati Senior Executive 05/15/2023

Digital banking increased post-Covid, a known fact.

The COVID-19 pandemic has been a driving force for digital banking across the globe. Bank branch opening hours were restricted and physical interactions were minimised, with businesses pushed to embrace self-service channels like never before.

Innovation in tech and artificial intelligence has been transformative, making it easier and faster for businesses to apply digitally, while still experiencing something of a personalised service. But are there limits?

In Q4 2022, Savanta asked businesses about their preferences for lending product applications – through personal (face-to-face or telephone) or digital (PC, laptop, mobile phone or tablet) medium.

Do businesses still want a personal touch? Yes, for more complex lending.

For more complex products like business overdrafts, loans and commercial mortgages, businesses prefer applying via face-to-face or telephone interaction. Over 7 in 10 prefer this medium over digital (PC, laptop, tablet or mobile).

But when it comes to a simpler product, like a credit card, digital interaction is much more acceptable. Here 1 in 2 would prefer to apply through a digital medium.

The more complex a product the greater the preference for a personal approach. No doubt part of this is practicality – regulatory and legal compliance for such products may require more detailed explanations. But preference is probably also driven by a need to build trust and understanding between both the business and the provider.

Digital preference in Northern Ireland vs in Great Britain

When we compare the data for digital preferences in Northern Ireland vs Great Britain, we see a similar pattern where the proportion preferring to apply digitally is higher the simpler the product.

However, it is interesting to note the difference between the two regions. Digital preference is higher in GB than in NI and across all four products tested.

Mobile Apps and Tablets are still trailing behind in digital space.

In both Northern Ireland and GB, digital preference is still very much PC/laptop led and the preference gap between applying for lending via PC/laptop and Mobile app/tablet is large. Whilst we may see this changing as app technology advances, it will likely take a change in business attitude for any great shift in the medium of preference to be seen here.

In summary, in Northern Ireland, face-to-face or telephone application is still the preferred lending application medium for 3 of the 4 products we tested as, at present, a personal approach is required.

Whilst digitalisation in the finance industry moves at pace, banks cannot overlook the need to maintain a balance between digital and human interaction and it is vital to also recognise that what works for Great Britain may not necessarily be the best fit for Northern Ireland.