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Retail Banking Market Insights: Denmark

Retail Banking Market Insights: Denmark

Summary

Denmark has a developed and sound financial system that plays an important role in the economy. The market for financial services is concentrated, with a handful of large banks controlling a significant market share. Danish consumers are generally conservative in their choice of provider, with a bias towards providers they have an existing relationship with.

Key Findings

  •  The current account market in Denmark is highly concentrated, with the top three providers accounting for 53%. Just 7% of Danish consumers have switched their current account in the last 12 months, which is well below the global average. These factors make it difficult for new entrants to make inroads in this space.
  •  Danish savers are cautious, with around three quarters putting money aside to protect themselves against unforeseen events. This caution is reflected in the strong preference for brands that are perceived to be honest, which is a top three driver of saving account provider choice.
  •  The high rate of mortgage ownership (46%) suggests Danish households have relatively broad access to credit. However, the country's mortgage market will only grow at a modest rate over the next few years.
Synopsis

Verdict Financial’s Retail Banking Market Insights: Country Snapshot Denmark is a review of the retail banking sector in Denmark, with a particular focus on the current account, savings, mortgage, and personal loan markets. It includes both market-level data and insight from our global consumer survey.
  •  Overview of Denmark’s banking sector.
  •  Insight into Danish consumer preferences and their reasons for taking out particular financial products.
  •  Learn about the main providers dominating the current account, savings, mortgage, and loan markets and the different factors persuading customers to choose them.
  •  Discover the extent to which consumers are using online and mobile channels to research, take out, and use their financial products.
Reasons To Buy
  •  Futureproof your strategy with market sizing, forecasts, and analysis of key developments currently affecting Denmark’s retail banking sector.
  •  Target consumers with inside knowledge of their true behaviors and attitudes, with detailed analysis from our proprietary insight.
  •  Learn about the impact new entrants and distribution channels will have on the market.


  • EXECUTIVE SUMMARY
    • The economic outlook is improving and the Danish banking system has become more stable
  • CURRENT ACCOUNTS
    • MARKET - MARKET SHARE
      • Denmark's current account market is concentrated, with the top five providers serving 66% of the market
    • CONSUMER - CHOICE OF PROVIDER
      • Choice of provider is driven by accessibility and reputational factors
    • CONSUMER - RECOMMENDATION
      • Jyske Bank has the highest advocacy rate among the main providers
    • CONSUMER - SWITCHING
      • Switching rates in Denmark are low, with push factors acting as the main trigger to move
    • CHANNEL - CHANNEL OPENING
      • The branch is still the most popular channel for customer acquisition
        • Table The branch is the most popular acquisition channel across the Nordics
    • CHANNEL - CHANNEL ACTIVITY
      • Complex, high-input transactions are typically conducted via branches and call centers
      • Digital channels are most popular for routine activities conducted on a frequent basis
    • CHANNEL - CHANNEL SATISFACTION
      • Consumers are more satisfied with online banking than any other channel
  • SAVINGS ACCOUNTS
    • MARKET – MARKET SIZING & FORECASTING
      • Retail deposits in Denmark are expected to grow over the forecast period
    • MARKET - MARKET SHARE AND CHOICE OF PROVIDER
      • The savings account market is less concentrated than the current account market
    • CONSUMER - REASONS FOR SAVING
      • Over two thirds of consumers are saving for unforeseen events
    • CHANNEL - CHANNEL OPENING
      • Digital channels are becoming more popular when opening savings accounts
        • Table Non-branch channels play an important role in savings acquisition across the Nordics
    • CONSUMER - RECOMMENDATION
      • Stability is key to customer recommendation
  • MORTGAGES
    • MARKET – MARKET SIZING & FORECASTING
      • Mortgage lending will grow at a modest rate over the next few years
    • MARKET - MARKET SHARE
      • Mortgage lenders in Denmark offer a similar portfolio of products
    • PRODUCT - PRODUCT FEATURES AND CHOICE OF PROVIDER
      • Borrowers choose lenders they have an existing relationship with
    • CHANNEL - CHANNEL OPENING
      • Digital channels are gaining popularity for mortgage arrangement
        • Table Branches and online are the main touchpoints during the mortgage journey
    • CONSUMER - RECOMMENDATION
      • Word of mouth recommendations play a strong role in increasing advocacy
  • PERSONAL LOANS
    • MARKET – MARKET SIZING & FORECASTING
      • Consumer credit originations will decline over the forecast period
    • MARKET - MARKET SHARE
      • The main branch-based banks dominate the personal loans market
    • PRODUCT - PRODUCT FEATURES AND CHOICE OF PROVIDER
      • Borrowers in Denmark are more price-sensitive than their regional counterparts
    • CHANNEL - CHANNEL OPENING AND REASONS FOR BORROWING
      • Digital channels are gaining momentum, but direct channels retain their importance for loan arrangement
        • Table Online and call centers are equally popular in the loan arrangement process
    • CONSUMER - RECOMMENDATION
      • Danish borrowers are reluctant to recommend their loan providers
  • BANK INFRASTRUCTURE & REGULATION
    • MARKET - INFRASTRUCTURE
      • Continued investment in Denmark's banking infrastructure is key
    • MARKET - REGULATORY ENVIRONMENT
      • The Danish authorities have strengthened regulation and supervision
    • MARKET – RECENT REGULATORY DEVELOPMENTS
      • The Danish authorities have taken important steps in recent years to improve resilience in the country's financial system
  • APPENDIX
    • Abbreviations, acronyms, and definitions
    • Methodology and further reading

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