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Current Accounts - Ireland - August 2014

Published By :

Mintel

Published Date : Aug 2014

Category :

Banking

No. of Pages : 121 Pages

The end of fee-free banking in RoI has made the prospect of owning multiple current accounts more expensive; and thus we have seen the incidence of consumers owning three or more accounts fall between 2009 and 2014. Moving forward, with more banks seeking to upgrade consumers to paid-for premium/packaged accounts, it will help to boost revenue generated from current accounts, but perhaps further lower the incidence of multiple account ownership.
Table of Content

Introduction

Key themes in the report
Data Sources
Consumer data
Definitions
Abbreviations

Executive Summary

The market
Figure 1: Total number of active current accounts, IoI, NI and RoI, 2009-19
Figure 2: Total number of current account holders, NI and RoI, 2009 and 2013
Forecast
Figure 3: Indexed total number of active current accounts, NI and RoI, 2009-19
Market factors
Increase in account switching for NI and RoI
Complaints about current accounts in NI and RoI account for three in 10 banking complaints
RoI consumers earn more, but wage levels have contracted
Fifth of NI and 16% of RoI consumers owe money on an overdraft
Companies, brands and innovations
The consumer
Almost all consumers own at least one current account
Figure 4: Number of current accounts currently owned, NI and RoI, July 2014
Santander most used provider of main accounts in NI
Figure 5: Financial institute where main current account and other current accounts are held, NI, July 2014
AIB and BoI top providers for RoI
Figure 6: Financial institute where main current account and other current accounts are held, RoI, July 2014
28% of NI and 20% of RoI consumers have switched their main account provider in the last five years
Figure 7: If consumers have switched current account providers, NI and RoI, July 2014
Figure 8: Reasons for consumers to switch current accounts, NI and RoI, July 2014
Better interest rates would attract more Irish consumers to packaged/premium accounts
Figure 9: Qualities of packaged/premium current accounts that consumers would be willing to pay a monthly fee for, NI and RoI, July 2014
What we think

Issues and Insights

What impact will account switching guarantees and legislation have on the market?
The facts
The implications
What could help drive uptake of ‘packaged’ current accounts?
The facts
The implications
How important are overdraft facilities to current account users?
The facts
The implications
How many current accounts does the average Irish consumer own?
The facts
The implications
Which banks do consumers have their current accounts with?
The facts
The implications

Trend Application

Trend: Totophobia
Trend: Minimize Me
Trend: FSTR HYPR

Market Overview

Key points
Much easier for NI and RoI consumers to switch accounts in 2014
Figure 10: Number of current accounts switched, UK, September 2013-June 2014
RoI account switching legislation
Figure 11: Number of current accounts switched in and out, RoI, 2011-13
Increased level of complaints about packaged accounts and ‘forced upgrades’ in UK
Figure 12: New complaints received about banking and credit, UK, 2013/14*
Figure 13: New complaints received about current accounts, UK, 2010-14*
Figure 14: New complaints received about current accounts, by type, UK, 2013 and 2014*
RoI current account complaints eased off in 2013
Figure 15: Complaints received relating to the banking sector, RoI, 2011-13
Figure 16: Complaints received relating to the banking sector, by segment, RoI, 2013
Figure 17: Types of complaints received for the banking sector, RoI, 2013
RoI consumers better able to make higher deposits each month
Figure 18: Household income, NI and RoI, April 2014
Figure 19: Median gross weekly earnings, NI, RoI and UK, 2009-14
Personal financial health improving between 2013 and 2014
Figure 20: How consumers rate their current financial situation, NI and RoI, November 2013-July 2014
NI consumers show stronger overdraft usage among Irish consumers
Figure 21: Consumers who currently owe money on a current account overdraft facility, NI and RoI, July 2014
Figure 22: If consumers are charged for using their overdraft facility, NI and RoI, July 2014
Increased cost of overdraft
Figure 23: Annual average retail interest rates on overdraft facilities, UK (including NI) and RoI, 2009-14
Figure 24: Indexed value of revenues generated from overdrafts vs personal loans (one year), RoI, May 2009-14

Strengths and Weaknesses

Strengths
Weaknesses

Market Size and Forecast

Key points
Strong level of account closure contracting the market
Figure 25: Total number of active current accounts, IoI, NI and RoI, 2009-19
Single account ownership set to be boosted by population growth
Figure 26: Total number of current account holders, IoI, NI and RoI, 2009-19
Figure 27: Total population of NI and RoI, actual and projected, 2009-19
Figure 28: Indexed estimated migration for NI and RoI, 2008-13
Decline in multiple account ownership in NI and RoI
Figure 29: Total number of current account holders, NI and RoI, 2009 and 2013
Current account ‘price war’ could help stimulate multiple account ownership
Figure 30: Best Buy current accounts and savings products, UK, July 2014

Companies and Innovations

Key points
Lloyds Bank focuses on tiered interest
M&S Current Account launches with no monthly fee
Tesco Bank launches current account with Clubcard incentives
Company profiles
Allied Irish Bank/First Trust
Figure 31: AIB current accounts, RoI, 2014
Figure 32: First Trust Bank current accounts, NI, 2014
Bank of Ireland
Figure 33: Bank of Ireland current accounts, RoI, 2014
Figure 34: Bank of Ireland current accounts, NI, 2014
Danske Bank
Figure 35: Danske Bank current accounts, NI, 2014
Halifax
Figure 36: Halifax current accounts, NI, 2014
HSBC
Figure 37: HSBC current accounts, NI, 2014
KBC Bank
Figure 38: KBC Bank current account, RoI, 2014
Nationwide
Figure 39: Nationwide current accounts, NI, 2014
Permanent TSB
Figure 40: Permanent TSB current accounts, RoI, 2014
Santander
Figure 41: Santander current accounts, NI, 2014
Tesco Bank
Figure 42: Santander current accounts, RoI, 2014
Ulster Bank
Figure 43: Ulster Bank current accounts, NI, 2014
Figure 44: Ulster Bank current accounts, RoI, 2014

The Consumer – Ownership of Current Accounts

Key points
Almost universal ownership of current accounts
Figure 45: Number of current accounts currently owned, NI and RoI, July 2014
Women in NI more likely to own multiple accounts
Figure 46: Number of current accounts currently owned, by gender, NI and RoI, July 2014
Younger consumers less inclined to own multiple accounts
Figure 47: Number of current accounts currently owned, by age, NI and RoI, July 2014
Affluent consumers more likely to own multiple accounts
Figure 48: Number of current accounts currently owned, by social class, NI and RoI, July 2014

The Consumer – Where Current Accounts are Held

Key points
Santander and Halifax top NI providers
Figure 49: Financial institute where main current account and other current accounts are held, NI, July 2014
Santander appeals to those of low affluence, Halifax to those of high affluence
Figure 50: Consumers who have their main current account with Santander and Halifax, by social class, NI, July 2014
A third of RoI consumers bank with AIB
Figure 51: Financial institute where main current account and other current accounts are held, RoI, July 2014
Younger consumers more likely to use AIB
Figure 52: Consumers who have their main current account with AIB and Halifax, by social class, RoI, July 2014

The Consumer – Account Switching

Key points
NI consumers more likely to have switched in last five years
Figure 53: If consumers have switched current account providers, NI and RoI, July 2014
Figure 54: Consumers that have switched current account providers in the last five years vs consumers who have never switched, by age, NI and RoI, July 2014
Where the switchers moved to
Figure 55: Main current account providers of those that have switched current accounts within the last five years, NI and RoI, July 2014
Better deals help to attract account switchers
Figure 56: Reasons for consumers to switch current accounts, NI and RoI, July 2014
A better deal appeals most to heavy internet users
Figure 57: Consumers who switch current account providers due to being offered a better deal, by internet usage, NI and RoI, July 2014
Cash incentives more likely to have made NI consumers switch account provider
Figure 58: Consumers who switch current account providers due to cash incentive or cashback offer, NI and RoI, July 2014

The Consumer – Factors for Packaged and Premium Current Accounts

Key points
Higher rate of interest strongly desired
Figure 59: Qualities of packaged/premium current accounts that consumers would be willing to pay a monthly fee for, NI and RoI, July 2014
Higher interest rates desired by mature consumers
Figure 60: Consumers that would be willing to pay a monthly fee for a premium/packaged current account if it offered a higher interest on savings products/money in current account, by age, NI and RoI, July 2014
Figure 61: Consumers that would be willing to pay a monthly fee for a premium/packaged current account if it offered mobile phone insurance, by age, NI and RoI, July 2014
Fee-free overdrafts appeal to the less affluent
Figure 62: Consumers that would be willing to pay a monthly fee for a premium/packaged current account if it offered fee-free overdrafts, by social class, NI and RoI, July 2014
RoI consumers show more interested in travel-related features
Figure 63: Consumers that would be willing to pay a monthly fee for a premium/packaged current account for travel and holiday-related features, NI and RoI, July 2014
Figure 64: Consumers that would be willing to pay a monthly fee for a premium/packaged current account for travel and holiday-related features, by age, RoI, July 2014
Irish women more in favour of card and ID protection features
Figure 65: Consumers that would be willing to pay a monthly fee for a premium/packaged current account for card and ID theft protection, by gender, NI and RoI, July 2014
Figure 66: Frequency with which consumers shop online, by gender, NI and RoI, March 2014

Appendix

NI Toluna tables
Figure 67: Consumers who own a current account and number of accounts held, by demographics, NI, July 2014
Figure 68: Financial institute where main current account is held, by demographics, NI, July 2014
Figure 69: Financial institute where main current account is held, by demographics, NI, July 2014 (continued)
Figure 70: Financial institute where main current account is held, by demographics, NI, July 2014 (continued)
Figure 71: Financial institute where other current accounts are held, by demographics, NI, July 2014
Figure 72: Financial institute where other current accounts are held, by demographics, NI, July 2014 (continued)
Figure 73: Financial institute where other current accounts are held, by demographics, NI, July 2014 (continued)
Figure 74: Consumers who have switched current account provider in the last five years, by demographics, NI, July 2014
Figure 75: Reasons consumers switched current account provider in the last five years, by demographics, NI, July 2014
Figure 76: Reasons consumers switched current account provider in the last five years, by demographics, NI, July 2014 (continued)
Figure 77: Reasons consumers switched current account provider in the last five years, by demographics, NI, July 2014 (continued)
Figure 78: Features of packaged/premium current accounts that consumers would be willing to pay for, by demographics, NI, July 2014
Figure 79: Features of packaged/premium current accounts that consumers would be willing to pay for, by demographics, NI, July 2014 (continued)
Figure 80: Features of packaged/premium current accounts that consumers would be willing to pay for, by demographics, NI, July 2014 (continued)
RoI Toluna tables
Figure 81: Consumers who own a current account and number of accounts held, by demographics, RoI, July 2014
Figure 82: Financial institute where main current account is held, by demographics, RoI, July 2014
Figure 83: Financial institute where main current account is held, by demographics, RoI, July 2014 (continued)
Figure 84: Financial institute where main current account is held, by demographics, RoI, July 2014 (continued)
Figure 85: Financial institute where other current accounts are held, by demographics, RoI, July 2014
Figure 86: Financial institute where other current accounts are held, by demographics, RoI, July 2014 (continued)
Figure 87: Financial institute where other current accounts are held, by demographics, RoI, July 2014 (continued)
Figure 88: Consumers who have switched current account provider in the last five years, by demographics, RoI, July 2014
Figure 89: Reasons consumers switched current account provider in the last five years, by demographics, RoI, July 2014
Figure 90: Reasons consumers switched current account provider in the last five years, by demographics, RoI, July 2014 (continued)
Figure 91: Reasons consumers switched current account provider in the last five years, by demographics, RoI, July 2014 (continued)
Figure 92: Features of packaged/premium current accounts that consumers would be willing to pay for, by demographics, RoI, July 2014
Figure 93: Features of packaged/premium current accounts that consumers would be willing to pay for, by demographics, RoI, July 2014 (continued)
Figure 94: Features of packaged/premium current accounts that consumers would be willing to pay for, by demographics, RoI, July 2014 (continued)

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