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Digital-Only Banks – Retail Banks for Retail Customers Only?

Author

Listed:
  • Katarzyna Schmidt-Jessa

    (Poznan University of Economics and Business, Poland)

  • Maciej Stradomski

    (Poznan University of Economics and Business, Poland)

Abstract

This paper explores how traditional banks perceive digital-only banks and the potential impact of digital-only banks on the retail segment of the banking sector. To obtain the main goal, we conducted in-depth semi-structured interviews with managers and directors representing different traditional banks with profound insight into the bank digitalisation process. The results indicate that, for traditional banks, the development of digital-only banks does not pose a threat or challenge that can significantly undermine their business. A high level of user experience, innovativeness, and lack of obsolete processes and technologies are the main advantages of digital-only banks that attract retail customers. At the same time, the limited range and scope of services provided and issues with compliance and trust translate into limited development opportunities.

Suggested Citation

  • Katarzyna Schmidt-Jessa & Maciej Stradomski, 2025. "Digital-Only Banks – Retail Banks for Retail Customers Only?," Journal of Banking and Financial Economics, University of Warsaw, Faculty of Management, vol. 1(23), pages 107-124.
    • Handle: RePEc:sgm:jbfeuw:v:1:y:2025:i:23:p:107-124
    DOI: 10.7172/2353-6845.jbfe.2025.1.8
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    File URL: https://press.wz.uw.edu.pl/jbfe/vol2025/iss1/9/
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    Keywords

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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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