Banking Blog

Finance Blogs » Banking » Survey: Banks targeting underbanked

Survey: Banks targeting underbanked

By Allison Ross · Bankrate.com
Thursday, July 31, 2014
Posted: 8 am ET

© Cynthia Farmer/Shutterstock.com

Hoping to grab more business, a rising number of bankers are turning to the unbanked and underbanked as opportunities for growth, according to a new survey.

The KPMG Banking Outlook Survey, released Monday, surveyed 100 senior bank executives. It found that 23 percent see underbanked consumers as the greatest growth opportunity, a jump from the 12 percent who said that last year.

In addition, 13 percent said they are looking to the unbanked, up from 5 percent last year.

"The nontraditional competitors, such as retailers, have already started gaining market share from this market segment," the survey notes.

Surveys in recent years have shown that banks could do more for the underbanked and unbanked segment of the population.

Growing bank branches?

The survey also found that bank branches are far from passe in the eyes of many bankers.

While some have predicted the demise of bank branches as new technology diminishes the need to drive to a bank branch, 41 percent of survey respondents say they plan to increase the number of branches over the next 12 to 18 months.

"While online and mobile technologies provide customers with convenience, branches offer the personal interaction that some consumers prefer," Judd Caplain of KPMG said in a release. "However, the new branches will be different from those of the past, with reduced size, enhanced technology capabilities, virtual customer service interactions, universal tellers, and an overall increased focus on the customer."

A Bankrate survey found recently that half of all bank or credit union customers had visited their local branch within the past 30 days for reasons other than the ATM, so clearly bank branches still have a place.

What do you think of banks' push to reach out to the underbanked?

And for those of you thinking of ditching your traditional banks, Bankrate has 6 reasons to be unbanked or underbanked.

Follow me on twitter: @allisonsross.

«
»
Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
4 Comments
Allison Ross
August 01, 2014 at 1:55 pm

Hi Kim,

You are looking at last year's survey, not this year's. (Note that the link you shared with me is the 2013 report.) Here is the pdf of this year's report. You can find the 23 percent stat on page 7:
http://www.kpmginfo.com/industryoutlooksurveys/2014/pdfs/KPMGBankingIndustrySurvey_072414.pdf

Let me know if you have any questions!

Allison

Kim Anderson
August 01, 2014 at 1:26 pm

Allison, perhaps you could direct me to the portion of the report which supports the statement that "23 percent see underbanked consumers as the greatest growth opportunity". Page 13 (https://www.kpmg.com/US/en/IssuesAndInsights/ArticlesPublications/Documents/2013-outlook-survey-banking.pdf)suggests the exact opposite, that only 12 percent see underbanked consumers as the greatest growth opportunity for the bank, down from 15% last year, or am I missing something?

Thanks.

Add a comment

(Comments may take 5-10 minutes to appear)