The Financial Services Competitive Landscape Continues to Shift – National Banks Still Lead Despite Being Challenged

Financial institutions in the U.S. face extensive challenges today from the emergence of new financial apps and non-traditional competitors along with diminished need for bricks and mortar branches, once a key strength for national banks. To assess the state of competition today, the National Technology Readiness Survey (NTRS) 2022, conducted by Rockbridge Associates, examined the state of the market today, including the penetration of different types of institutions and their relative strengths. We found that while there is cause for concern among traditional financial institutions, national banks still dominate the retail banking space and are most frequently considered the best at meeting a wide range of consumer needs. Behind national banks, credit unions and community banks are best at meeting needs in many areas.

In our latest survey, just over 6-in-10 consumers report using a national bank, which is roughly double the percentage indicating they use an online/mobile-only bank, a credit union, or a community bank. When asked which type of financial institution is their primary provider, nearly half indicate it is a national bank compared to roughly 1-in-6 for each of a community bank, a credit union or an online/mobile only bank.

Large national banks can be secure in their commanding market share, although they should be concerned with the large penetration from online/mobile only banks that include brands like Chime, Allied and SoFi. Along with investment apps, these institutions constitute a threat to traditional financial institutions because they leverage convenient technology to siphon market share from younger consumers starting out their financial lives. The type of financial institution consumers use varies by demographics, including age cohort. For online/mobile-only banks, penetration and consideration as a primary institution is higher among consumers under age 55:

  • 18 – 34 years old: penetration is 45% and designation as the primary institution 23%
  • 35 – 54 years old: penetration is 35% and designation as the primary institution is 18%
  • 55+ years old: penetration is 17% and designation as primary is 8%.

Investment apps are also more widely used by consumers under 55 (penetration is 15% among 18–24-year-olds, 10% for 35–54-year-olds and 4% for 55+ year olds).

Credit union usage is higher among men (33% versus 22% for women) and consumers over age 55 (34% versus 26% for 35–54-year-olds and 21% for 18-34 olds).

Investment firm/brokerage and insurance firm penetration is highest among more educated consumers. Nearly 4-in-10 (37%) consumers with a bachelor’s degree or higher report use an investment firm/brokerage, compared to only 18% of those with some college and 9% of those with a high school diploma or less. One in five with at least a bachelor’s degree indicate they use an insurance firm (versus 10% with some college and 6% with a high school diploma or less).

Clearly, traditional institutions such as national banks, community banks and credit unions need to pay attention to competition from potential disruptors. The good news is that these institutions still tend to do the best job meeting consumers’ needs. We asked consumers to indicate among the institutions they use which type they felt was best in meeting a variety of needs. If consumers used only one type of financial institution, we asked them to tell us if each provider satisfied the need (i.e., deserved to be “best”). Looking at results based on all financial institution users reveals that national banks lead as best on all needs or features evaluated, although they are never considered best by more than half the market. Alternatively, consumers regard insurance firms and investment apps as best 3% or less of the time for every area (and are therefore not displayed in the table below).

(Note: Read our recent Rockbridge blog What Matters to Bank Customers – A Story of Relationships, Returns and Making the World a Better Place [1] for a related look at the data below, where we show the share of consumers rating each financial institution as best among users of that financial institution type only.)

Credit unions and community banks come in second, making the top 3 financial institution types for most features we evaluated. However, the oldest consumers are more likely to choose credit unions as best. Many credit unions have struggled to attract and retain younger members and to lead on innovation. Our study reveals that only 8% of consumers ages 18-34 and 11% of those ages 35-54 think credit unions are the best at being innovative (compared to 22% of those ages 55+). Both national banks and online/mobile-only banks outperform credit unions on innovation, and consumers under age 55 are more likely to choose online/mobile-only banks as most innovative (29% ages 18-34, 20% ages 35-54 versus 8% ages 55+). For additional information about the criticality of innovation as a way for credit unions to remain competitive in an increasingly crowded marketplace, review the results of the Credit Union Innovation Success Study [2] from the Filene Research Institute in partnership the Responsible Business Coalition at Fordham University’s Gabelli School of Business and Rockbridge Associates.

Although coming in behind national banks, community banks stand out for making a positive impact in the community, having caring and responsive employees, and providing convenient branch and ATM coverage. Online/mobile-only banks are chosen as best by the second largest proportions of consumers for being innovative, providing easy to use technology solutions and making it easy to access money. Aside from traditional banks, investment firm/brokerages stand out for providing guidance to achieve financial goals.

One final notable finding is that one-quarter of consumers believe no financial institution is best at making a positive impact in the world, which edged out the proportion who chose national banks as best. The oldest consumers are more likely to hold this belief, with nearly 4-in-10 reporting so (compared to only 19% for 35-54 and 12% for 18–34-year-olds). Financial institutions should aim to improve social innovation and find ways to positively impact the communities they serve and the world at large.

The good news for banks and credit unions is that they continue to lead in market penetration and being best on meeting needs. However, online/mobile only banks are clearly making an impact in the market, particularly among younger consumers.


About the Study: the National Technology Readiness has tracked technology and e-commerce trends since 1999. The survey is co-sponsored by Rockbridge Associates, Inc. and the Responsible Business Coalition at Fordham University’s Gabelli School of Business. The most recent wave was conducted in June 2022 and is based on an online survey of 1040 U.S. adults sampled at random from a consumer research panel. Results are weighted to match census characteristics. For more information, contact

Written by: Emily Waters, Research Director and Charles Colby, Chief Methodologist


[1] What Matters to Bank Customers – A Story of Relationships, Returns and Making the World a Better Place

[2] Credit Union Innovation: The Member Perspective