According to Mckinsey’s report titled “Asia Banking in the Digital Consumer Age,” South Korea’s digital banking penetration is on a par with that of New Zealand at 99%.
According to Fintechnews (1), the digital banking penetration rate refers to the percentage of people using digital banking in the past. South Korea, Singapore and Hon Kong showed digital bank penetration of over 96%, while Japan emerged as the lowest among the advanced Asian countries at a penetration rate of 77 percent.
Asia’s emerging economies show a varying degree of penetration with China, Indonesia and Malaysia recoding 84, 56 and 64 percent, respectively(1).
Digital Banking Activity
Fintechnews stated that other indicators of digital banking activity showed South Korea at the forefront of digital consumers. Using the criteria of those who used digital banking more than once every 2 weeks or purchased e-commerce products more than once in the last 6 months, the figure reached 90 percent in South Korea, ranking the east Asian country first in the Asian region.
Fintechnews also recorded that active digital consumers in South Korea made 6 – 8 times more purchases of related products than their digitally marginalized counterparts.
Accessing internet banking
Fintechnews reported that the survey found that 90 percent of South Korean consumers were willing to open an account at an internet bank, saying that they would transfer around 40 percent of their assets to digital accounts.
This figure illustrates that Korea’s digital consumer is more readily embracing internet banking than other Asian countries, where 60 – 80 percent of respondents said they intend to open internet bank accounts where they would move 35 – 40 percent of their assets.
Fintechnews reported that the digital banking penetration rate in the region’s emerging economies has increased 2 – 4 times since 2015, mainly through smartphone adoption.
Active Digital Consumers
Active digital consumers increased 2-fold in emerging economies in Asia, outperforming those in advanced countries in Asia by 1.2 times.
Status of Offline banking
The increase in digital banking accounted for a decrease in the monthly average transactions through traditional offline branches, which accounted for some 10 – 25 percent of the total transactions, with consumers showing a preference for digital over traditional channels for simple tasks such as account queries and transfers.