The number of UK adults using a digital-first neobank for financial services has grown from 16 per cent in 2018, to 50 per cent at the end of 2024, according to new research.

A study from RFI Global, which surveyed 4,000 consumers, finds that while traditional banks still dominate financial services, more consumers have their main debit card with a neobank and spend 20 per cent more than consumers with a main debit card from a Big Six bank.

The research reveals that consumers holding their main debit card with a neobank rose from 1 per cent at the end of 2020 to 9 per cent at the end of 2024, while the share of market for the Big Six banks decreased from 85 per cent to 71 per cent in the same period.

“Everywhere you look neobanks are becoming a bigger part of the system,” said Hubert Petka, group director at RFI Global. “They are popular among younger generations such as Gen Z and millennials who value their advanced digital capabilities and convenience.

"Yet banks remain resilient as they increase their agility and consumers continue to use their cards, alongside cards from neobanks, to meet their day to day needs. Nonetheless, neobanks are poised to grow in the years to come and could really threaten the dominance of the incumbent players over the next decade."

The study also found that UK consumers are increasingly diversifying their financial activities by embracing a wider variety of providers. The average number of financial providers used per person climbed from 4.3 in 2015 to 5.3 at the end of 2024.

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