Internet security, consumer choice and lack of services are some of the main reasons behind results of a survey that shows online banking has reached a plateau after an explosive growth period between 2000 and 2003, according to a Canadian marketing research firm.
In its annual How Canadians
Bank study, which was conducted last fall, TNS Canadian Facts found 30 per cent of Canadians reported using an online banking service in the month prior to the survey. Out of that number, the largest group to use online banking is 25 to 34 year olds at 48 per cent. That number drops to 35 per cent for those aged 35 to 49.
The results, similar to the 2003 study, also revealed that only six per cent of non-users are likely to begin using in the first half of 2005. For the survey, TNS sent out 4,500 questionnaires to its panel of men and women 18 years and older. Approximately 2,800 or 48 per cent of that group responded.
Between 2000 and 2003, the proportion of Canadians who were banking online doubled from 14 to 33 per cent in 2003 compared with only two per cent in 1997, said Rhonda Grunier, a vice-president at TNS, which has been tracking online banking since 1997.
“”It had been growing at such a fast pace it would be difficult to maintain that,”” said Grunier. “”We’ll still see growth but it’s going to be at a much slower pace.””
One of the main reasons behind this plateau in online banking among non-users is concern about Internet security, Grunier said.
“”We find consistently about a third of them say they’re concerned about online security so they would be hesitant to bank online because of that,”” she said.
Despite concerns about Internet security, Scotiabank continues to see increasing customer adoption rates of online banking. About 50 per cent of Scotiabank’s customers across Canada bank online, said Bob Grant, senior vice-president of electronic banking at Scotiabank in Toronto.
“”Once (customers) are on the Internet, they use it for more and more activities,”” said Grant. “”Our customers continue to think the Internet is a great way to bank. More and more customers are adopting it.””
Grant added Scotiabank has been relatively unscathed by recent phishing expeditions, where users are sent false e-mails that resemble legitimate communication from banks, thanks to some initiatives it has undertaken.
However, Christopher Musto, vice-president of research at Watchfire Corp., said a big concern among banks is that consumers are starting not to trust online banking and because of that are less willing to try it.