Ratio of bank customers gained and lost in the UK Q3 2024
The rise of digital disruptors, challenger banks, and sustainability-focused financial institutions has transformed the banking landscape, attracting billions in investment capital. To effectively compete with established banks, these newcomers face a dual challenge: they must both drive substantial customer acquisition and successfully retain those customers over time. Customer retention rates among UK banks have historically shown significant variation between traditional and digital banks, with some digital banks achieving impressive customer loyalty while others have struggled to maintain their customer base. In the third quarter of 2024, both Starling Bank and Monzo saw a positive retention ratio.
Biggest winners
In the third quarter of 2024, Nationwide emerged as the leader in customer retention, achieving an impressive ratio of 2.3 new customers for every one lost. TSB also demonstrated strong performance, with 1.81 customers switching to their services for every departing customer. In stark contrast, AIB Group faced significant challenges, with a concerning ratio of 36.1 customers leaving for each new customer acquired.
Customer growth of neobanks
Digital-only banks have achieved remarkable growth in the European financial sector, with London-based Revolut leading the charge. In November 2024, Revolut reported a significant milestone of over 50 million global customers, building on its strong momentum from 2024 when monthly app downloads surpassed two million.