New banking index reveals financial loyalty is more fragile than it looks
Switching banks is back on the radar for UK consumers, with new Cardlytics research revealing that loyalty is increasingly conditional and driven by clear financial value.
Based on a nationally representative survey of 4,000 UK adults, the Cardlytics Banking Index shows that while most consumers are not actively planning to switch, many are responsive to tangible financial benefits, especially when rewards are personalised and linked to everyday spending.
Two-thirds of consumers (65%) say they feel loyal to their main bank, and 60% say they are unlikely to switch in the next 12 months. However, more than half (57%) have switched their main bank account at some point as an adult, suggesting that stability should not be mistaken for permanence.
Trust and service remain essential, but value is becoming a clearer differentiator. When asked what keeps them with their current bank, consumers cite good customer service (40%), brand trust and reputation (35%) and the quality of mobile or online banking (32%). Among Baby Boomers, 50% say customer service is a key reason they stay.
While only 16% of UK adults say they are likely to switch their main bank in the next 12 months, this rises to 25% among Gen Z and 24% among Millennials, indicating younger consumers are more willing to reconsider their banking relationships.
When consumers do consider switching, the triggers are clear: 36% cite better savings or interest rates, 28% better cashback or rewards and 27% a financial incentive to switch.
Among those who have never switched, inertia remains a powerful factor. More than a quarter (28%) say they see no strong reason to change, 24% say their finances are already set up with their current bank, and 20% say switching feels like too much hassle.
The research also points to a clear opportunity for more relevant, value-led retention strategies. If offered personalised cashback based on their actual spending habits, 47% of UK consumers say they would be more likely to remain with their bank, including 20% who say they would be much more likely to stay. Among 18-34s, this rises to 55%.
That matters in the context of everyday spending priorities. When managing costs such as groceries, fuel and household bills, 39% of consumers say keeping overall costs low is most important, followed by convenience (22%) and accessing rewards or cashback (13%).
Loyalty is also no longer exclusive. While 44% say they do not hold more than one current account, many consumers spread their money across providers to separate spending (17%), avoid reliance on one bank (14%) or manage joint and personal finances separately (13%).
“Loyalty in banking can no longer be taken for granted,” said Lucy Whittemore, SVP, UK Partnerships at Cardlytics. “While most customers are not actively planning to switch, many are open to change when the value is clear. Banks cannot rely on inertia to protect retention.
“Trust and service are now the baseline, and in order to stay competitive, banks need to make their value visible in everyday moments. Personalised rewards are a practical way to reinforce relevance and strengthen retention in a market where customers are ready to move.”