The impact of the internet on the media and retail industries is well documented, but less so is the change it is starting to bring in consumer financial services.

According to McKinsey’s ‘2011 Asia Personal Financial Services‘ survey, the use of bank branches is faltering across Asia, down 27% since 2007 – the first recorded drop in branch visitation since McKinsey began the survey in 1998. The annual survey examines developed Asian countries Korea, Japan, Taiwan, Hong Kong, Australia and Singapore.

Of the six interactions consumers in developed Asia have with their banks each month, more are now conducted using the internet and mobile channels (averaging 3.2 times a month) than traditional channels such as in-branch and telephone (2.6 times a month).

This change is being noticed across both subscription (purchase of a new product) and transaction interactions. In fact, more than a quarter (27%) of consumers say they would prefer to subscribe through digital channels the next time they buy a savings or basic investment product, an increase of 5% since 2007.

The study also found that the changes in consumer behaviour were not just a shift towards digital, but that consumers have started using multiple channels. The majority of respondents in the six developed Asian markets used at least five channels to research a new savings or basic investment product, 1.7 channels for making a transaction and 1.8 channels for service requests.

Word of mouth, offline media and third party agents were the additional channels that people were using for their banking needs.

The authors of the report commented, “Banks need to provide customers with a seamless experience across all channels.

“Done right, the institutions that create the right kind of experience will win tangible economic rewards through increased cross-selling and customer loyalty.”

In the six developed Asian markets surveyed, Japan and Australia led the pack when it came to accessing subscription and transaction services through digital channels, with Singapore also showing strong usage.

The report notes that the increased use of digital was not limited to tech-savvy, younger consumers. Consumers aged 55 and older were just as likely to use online banking for transactions and services as any other age group.


McKinsey’s 2011 Asia PFS surveyed 20,000 consumers in 13 countries to understand how consumer behaviour in the banking sector is changing.