Most savers opening new accounts in 2020 ‘opted for online-based deals’

Many savers have opted for accounts they can manage from a distance during the coronavirus pandemic, a survey has found.

Of those people who have opened a savings account in 2020 – with some choosing more than one type – 79% chose a digital or online-based one, 11% chose a phone-based deal and 5% opted for a postal account, banking and wealth management services provider Investec found.

One in seven (14%) opted for an account they could manage through a branch.

Despite the financial strain the crisis has placed on households, 19% of people said they are putting more into their savings accounts – with some doing so because they have spent less money than they did before the coronavirus crisis or due to concerns about future job security.

But 22% said they are saving less.

The most common reason for people opening online accounts was that they perceived them as offering better rates, the research found.

A quarter (24%) said that since lockdown they had increasingly been using digital tools such as apps to manage their money.

Nearly a fifth (18%) of savers said they chose not to open a branch-based savings account because they wanted to avoid visiting branches during the crisis.

And more than one in 10 (12%) said they had avoided branch-based savings accounts because of some bank branches being shut.

The findings were based on a survey of more than 1,000 people across the UK by Consumer Intelligence.

Investec also commissioned Andrew Hagger of MoneyComms to analyse the savings market and found that more than half (54%) of savings accounts launched between March and October were online-only, while less than one in 10 (9.6%) were branch-based.

Investec published the research following the launch of its new Online Flexi Saver instant access account.

Linda Brown, head of savings at Investec, said: “It’s clear that the Covid-19 crisis has accelerated the use of online and digital platforms, but this is a continuation of a trend we’ve seen among our own client base in recent years.

“It’s becoming more and more important for people to be able to interact digitally with their savings products as it provides a slicker experience that puts the client in control, particularly at times when freedom of movement and access to branches is restricted.”