Bain survey shows customers are interested in banking with Amazon

Amazon is likely to find ready customers if it follows with its project to launch a banking service.

And that could be bad news for traditional retail banks.

A significant portion of consumers – including nearly two-thirds of Amazon Prime subscribers – say that they would sign up for a new free account with the e-tail giant, a Bain & Co. consulting company said in a new report. At the same time, consumers have expressed much more loyalty to Amazon than national or even regional banks, Bain reported.

"Our study suggests that Amazon can count on a significant demand for basic banking services," said in their report Gerard du Toit and Aaron Cheris, partners at Bain. They continued: "The threat of Amazon [to traditional banks] is real and imminent. "

The Wall Street Journal reported in March that Amazon was in talks with JP Morgan Chase for a partnership on a bank account that the e-tailer would offer to its customers. The report followed months of speculation that the company was considering entering the financial sector. Amazon has not yet officially unveiled its banking services, but we are generally expecting them to do so.

Consumers are interested in banking with Amazon

Consumers are likely to be receptive if that is the case. Some 65% of Amazon Prime subscribers would subscribe to a company account for free if it was a 2% refund of their purchases from the company, said Bain in his new survey.

But even many non-members are interested. Some 43% of Amazon customers who are not subscribers said that they would subscribe to this type of free account with the company, just like 37% of consumers who are not subscribers said they would subscribe to this type of free account with the company, just like 37% of consumers who are not not customers of Amazon.

Perhaps more worryingly for traditional banks, younger consumers were more interested in an Amazon bank account than the old ones. According to Bain's report, over 60% of consumers aged 18 to 34 said they would engage in a free Amazon bank account. In contrast, less than 40% of consumers aged 55 and over said they wanted to.

Younger consumers are generally more likely to change financial service providers than their older customers.

But also worrying for banks, interest in registering for an Amazon account has increased with the income of consumers of all ages. Better-off consumers tend to be more profitable for banks than the less fortunate.

Amazon customers are loyal; the customers of the banks, not so much

Amazon also has an opportunity as it has gained much more customer loyalty than banks, according to the report, leveraging their comparative Net Promoter scores. These scores represent the difference between the portion of respondents who are most likely to recommend a business to their friends and family and the party who would not want it or could even denigrate it.

The e-commerce giant scored an overall score of 47 in Net Promoter. In contrast, the regional banks collectively received a rating of 31. National banks earned 18 points.

Banks had a lower net promoter score among those who were interested in signing up for an Amazon bank account than among those who did not, said Du Toit and Cheris in the report.

"For banks, the level of customer loyalty will likely serve as an advance indicator of defection," they said. "The more consumers are unhappy with their bank, the more they are willing to consider Amazon."

If Amazon were to engage in financial services, it would have an attractive customer base. Amazon customers tend to be richer and have higher incomes than the average American, according to Bain data. The company's clients globally account for about 75 percent of the country's wealth, while core customers alone account for about 45 percent, according to the consulting firm.