Online banking proves a hit with time-poor Britain

The way people buy and handle financial services is set to undergo a radical transformation which is giving regulators, providers and intermediaries cause to rethink their attitudes

The way people buy and handle financial services is set to undergo a radical transformation which is giving regulators, providers and intermediaries cause to rethink their attitudes

Sainsbury's Bank this week predicted a big increase over the next 12 months in the number of financial services products purchased online. Derek Bottom, the banks's deputy chief executive, said: "As many as three million people could be arranging financial services products online, 700,000 more than last year."

He added that there has been a 600 per cent increase in usage of the bank's website (www.sainsburysbank.co.uk) over the past three years, and an increasingly large percentage of its products are now purchased online.

And according to the research house NOP World Financial, last year's 31 per cent growth in the online purchasing of financial services products is set to continue in 2004. Mr Bottom said: "People are becoming increasingly time-poor, and this has been a significant factor behind the growth of the online banking sector and supermarket banking in general."

Of those who bank online, the main reason is convenience, the response given by 52 per cent of respondents. This is followed by a lack of sales pressure (45 per cent), speed (39 per cent), product discounts (37 per cent) and having more time to understand products and services (31 per cent).

Motor insurance is the most popular online financial service. NOP said half of financial online website users purchased motor insurance. This was followed by one in four signing up for a credit cards this way and one in five committing to home insurance.

Of those people who purchase banking and insurance products online, their preferred time is weekday evenings, the response from 17 per cent of respondents, but 6 per cent would choose to do so late at night.