SEOUL, Dec. 7 (Korea Bizwire) – Internet-only banks like K Bank and Kakao Bank are rated higher in consumer satisfaction than online banking services provided by traditional financial institutions, but trust issues with the online services remain.
Consumer satisfaction with internet-only banks was higher in six categories, among them bank fees and interest rates, compared to online banking services from traditional banks, according to a survey listed in the latest consumer report from Consumers Korea.
The widest gap in satisfaction was found to exist in wire transfers and cash withdrawals, with internet-only banks (IOB) earning a score of 4.04 out of 5, while their counterparts lagged behind with a 2.75 score.
K Bank users can withdraw cash from ATMs at GS25 convenience stores and at Woori Bank with no extra fees, and the latter also allows deposits and wire transfers without surcharges.
Kakao Bank lowered its fees for international transfers to one-tenth those of traditional banks.
For savings, self-identification methods and loans, IOBs received marks of 3.66, 3.82 and 3.52, compared to 2.59, 3.22 and 2.54 for online banking services.
Interest rates for savings accounts at traditional banks hover around 2 percent, even after accounting for promotional offers. Meanwhile, Kakao Bank offers products with maximum 2.4 percent and 2.7 percent rates.
Greater satisfaction with IOB self-identification methods is believed to stem from their reliance on biometric data or a 6-digit PIN number rather than the cumbersome public certificate key that is usually required.
IOBs even outperformed their counterparts when it came to personal information, security and customer complaints, areas that had previously attracted the greatest amount of customer dissatisfaction.
However, the survey found that more consumers trusted traditional banks than IOBs, as 75.2 percent responded that they trusted the online banking services of brick-and-mortar institutions, while only 38.7 percent said the same for entities like Kakao Bank and K Bank.
The participants named privacy concerns such as personal information leaks as the biggest problem associated with IOBs, and in addition expressed concern that without meeting face-to-face, occurrences of incomplete transactions could become an issue.
A total of 700 users of mobile and internet services from traditional banks between the ages of 20 and 59 took part in the survey.
Kevin Lee (firstname.lastname@example.org)