Three out of four Australians and New Zealanders consider the quality of their banking app a significant determinant in whether to stay or switch banking providers, a new consumer survey has revealed.

Findings from the newly released report, Byte-Sized Banking: The App Experience 2024, by financial technology developers Experian and Moneythor show that “having a quality banking app with a good user experience” can significantly improve customer retention.

Indeed, a broad cross-section of Aussies and Kiwis banking app users said they were ready to switch banks if provided with a better app experience and access to tools to help them manage and stay on top of their finances.

Four out of five (80 per cent) respondents within the 25-44 age bracket said their app experience was a key consideration for staying with a bank, with no significant drop off for 45–54-year-olds (79 per cent) and 18-24-year-olds (77 per cent).

Usage of banking apps has also increased markedly in recent years. More than half (57 per cent) of Australians and New Zealanders use their banking apps between three and 10 times a week, with over a quarter (28 per cent) logging in more than ten times to check budgets, review savings goals, transfer money, or track spending.

Overall satisfaction with Aussie banking apps (covering both big four and challenger brands) currently stands at 82 per cent, according to the survey. Only 9 per cent of respondents expressed dissatisfaction with their current banking app.

Banking apps’ ease of use (81 per cent), the accuracy of transaction information (78 per cent) and features such as transaction search (77 per cent) were cited as the main reasons behind this level of satisfaction.

However, challengers notably lag their big four bank rivals in customer satisfaction, with the majors’ apps rated considerably higher (89 per cent) than their challenger banking rivals (at 72 per cent).

This ratings differential was also true across features within banking apps, including transaction search (hitting an 84 per cent customer satisfaction rating for big four bank apps vs 67 per cent for challengers), the clarity and accuracy of transaction information (83 per cent vs 69 per cent), and access to products and services (83 per cent vs 61 per cent).

Customers satisfied, but want more guidance

However, for both challengers and majors, customers expressed a demand for more from their banking apps, particularly to help manage their money.

“[There] is a clear need to transform the bank apps of today into a one-stop financial shop to give the customer more control over their money management, which aligns with the sentiment towards using a banking app as the primary tool for managing finances,” the report read.

“The study identified an opportunity for banks to add new, in-demand tools to their apps that will help their customers feel more confident with their money management and financial wellbeing.”

Respondents, in particular, expressed a lack of satisfaction with several app features, including personalised recommendations, financial education tips, tools and recommendations to help pay down debt faster, and subscription management and notifications – with each category rated under 39 per cent for customer satisfaction.

For instance, 60 per cent of respondents said they want more budgeting suggestions (including 68 per cent of 25–44-year-olds) and better categorisation of transactions in their banking app to assist with spending management (demanded by 68 per cent of 25-34-year-olds).

As well, a majority of respondents (58-59 per cent) are seeking more features and insights to manage their financial well-being and personalised recommendations based on their spending habits and financial goals  (sought by 67 per cent of 25-34-year-olds).

A substantial number (86 per cent) said they expect their bank to track their spending.

“This research underscores the importance of banking apps for customers in Australia and New Zealand, said Jordan Harris, head of innovation at Experian A/NZ, in response to the report.

“As cost-of-living pressures intensify, the reliance on banking apps for effective budgeting and financial management has never been greater.”

Harris added: “While current satisfaction levels with banking apps are high, there is a clear demand for enhanced features and proactive tools.

“Banks can seize the opportunity to transform their apps into comprehensive financial hubs that offer personalised advice, enriched transaction data and sophisticated financial management tools.

“By doing so, they can not only meet the rising expectations of their customers but also strengthen customer loyalty in an increasingly competitive market.”