Right. Let me take you back twenty years, to a focus group room in Oslo.
It was 2005, and I was running consumer research for a Nordic digital transformation programme at GE Capital. Remember, this was pre-iPhone, pre-app – “digital” still meant a website and a password you’d written on a Post-it. One participant, when asked about managing his finances online, said something that has stuck with me for two decades. Yes, he said, he did the basic stuff online – checking balances, simple payments. But for anything more complex, he wanted – and I quote – “the human touch, as Bruce Springsteen would call it.”
The room laughed. I wrote it down (I’m also a Springsteen fan!). And here we are, twenty years, several technology revolutions, and a few trillion pounds of digital transformation spend later – and that gentleman in Oslo has turned out to be a better forecaster than most of the strategy houses.
Springsteen released Human Touch in 1992 – a song about wanting just a little of that human touch in a world that feels increasingly distant. He wasn’t singing about banking. But he might as well have been writing the strategy paper for UK financial services.
We’ve spent the last few posts on this blog talking about technology – GenAI in the engine room, Martech as the translator of mutuality, the app store as the new battleground for Gen Z. And I stand by every word. The sector must digitise, and faster than it’s comfortable with.
But here’s the thing nobody puts on the transformation roadmap – the thing my Oslo participant understood instinctively in 2005: the more digital financial services becomes, the more valuable the human becomes. Not less. More. And the data increasingly suggests this isn’t a static preference – it’s a rising one.
This isn’t nostalgia talking. It’s economics. When something becomes scarce, its value goes up. And right now, genuine human interaction in UK financial services is becoming very scarce indeed.
The Digital Job Is (Mostly) Done
First, let’s be clear about where we are. The digital shift isn’t coming – it’s happened.
- Around 87% of UK adults – roughly 47 million people – now use online or mobile banking in some form.
- The share of UK adults holding a digital-only bank account has gone from 9% in 2019 to around 40% in 2025. That’s not a trend; that’s a landslide.
- For everyday tasks – checking a balance, moving money, paying a bill – self-service is now simply how Britain banks.
So the “should we go digital?” debate is over. Anyone still having it has already lost. The interesting question – the strategic question – is what happens to the human in all of this.
What the Data Actually Says About Humans
Here’s where it gets interesting, because the survey data tells a far more nuanced story than “digital wins, humans lose.”
FICO’s UK Bank Customer Experience Survey found that while a good app now ranks above a nearby branch as the most important factor in choosing a primary banking provider, 80% of consumers said being able to talk to a real person was important to them. Not 80% of pensioners. 80% of everyone.
And the stat that should be pinned to every boardroom wall in the sector: just over half of 18–24 year olds rated the importance of human contact a full five out of five. The generation we keep assuming wants to live entirely inside an app values human access almost as much as the over-65s do.
The same research found 64% of people believe customer service is as important as the products themselves – and over a fifth think it’s more important. Read that again. A chunk of the market would take a slightly worse rate with brilliant human service over a slightly better rate with none.
Accenture’s global consumer study (49,000 respondents, so not a small sample) adds the texture: most people now use their bank’s digital channels for quick, functional tasks only. The channels work – but in Accenture’s rather brutal phrase, they’re “functionally correct but emotionally devoid.” Efficient, yes. Relationship-building, no. Meanwhile, two-thirds of consumers say they like seeing a branch in their neighbourhood because it signals their provider is stable and there – and that sentiment holds across every age group.
The pattern, in one line: people want digital for the everyday, and humans for the moments that matter. Not digital or human. Digital and human, each doing what it does best.
Is the Human Touch Actually Becoming More Important?
This is the question worth pausing on, because “humans still matter” and “humans matter more than they used to” are very different claims. In my view, the evidence points to the second – for four reasons.
1. AI fatigue is now a measurable thing. Industry research in late 2025 started putting a name to something many of us have felt: consumers are hitting a wall with digital experiences that feel automated, generic, and tone-deaf. “Personalisation at scale” built purely on algorithms is falling flat – people want authenticity, not an algorithm pretending to know them. Tellingly, the institutions reported to be gaining momentum from this are community-rooted ones: credible digital tools, backed by real humans. Sound like anyone we know?
2. The supply of humans has collapsed, and demand hasn’t. Banks and building societies have closed close to 6,800 branches since 2015; a third of all UK branches have gone in just five years, leaving roughly one branch per 10,000 people (France has nearly five). Accenture found that 44% of 18–44 year olds had problems getting human support when they actually needed it. When demand holds steady and supply collapses, the value of what’s left rises. That’s not sentiment; that’s a market.
3. AI is raising the stakes of trust, not lowering them. As AI takes over more of the routine, what’s left for humans is precisely the high-stakes, high-emotion work – and consumers are explicit that they want human accountability there. Recent consumer research found that even among heavy AI users, banks and people remain far more trusted for actual financial decisions than the technology itself. The more decisions machines inform, the more people want a human to ownthem.
4. The complex moments aren’t going away – they’re growing. Affordability stress, later-life lending, vulnerability, bereavement, self-employment, fraud recovery. Consumer Duty has made human-quality support for these moments a regulatory expectation, not a nice-to-have. The volume of “moments that matter” is rising just as the industry’s capacity to handle them humanly is shrinking.
So yes – I’d argue the human touch is genuinely appreciating in value, in the proper investment sense of the word. Which makes the next question obvious: who’s positioned to capture that value?
The Cautionary Tale Next Door: SME Banking Ran This Experiment First
If you want to know how the consumer story ends, look at business banking – because the SME market ran the “strip out the humans” experiment a decade ahead of retail. And the results are in.
Through the 2010s, the big banks systematically withdrew relationship managers from small and medium-sized businesses. Personal support was reserved for large corporates; everyone else got a call centre and a portal. The consequences:
- Research found almost two-thirds (65%) of UK SMEs were unable to get access to a senior decision-maker at the Big Four banks. Not “found it slow” – unable.
- Accenture’s UK SME banking research found that while 72% of SMEs say their business positively needs digital banking, only around a quarter would give up their relationship manager for a digital-only alternative — even if it were cheaper. The human relationship survived a price test. Very few things in banking survive a price test.
- A quarter of SMEs now hold their main bank account outside the Big Four, with even more placing deposits and borrowing elsewhere.
And here’s the punchline. The fastest-growing fintech in UK history – Allica Bank – built its entire proposition on reintroducing the relationship manager, armed with modern technology. A dedicated human for every established business customer, nearly tripling its RM network at the very moment the high street banks were still removing theirs, and billions in lending and deposits to show for it. Their pitch, almost word for word: business banking how it used to be, just better.
Let that sink in: in 2025, the most disruptive idea in UK business banking was a person who knows your name – delivered on a modern tech stack.
The lesson for retail: SME banking proves that when incumbents withdraw the human, customers don’t simply adapt and forget. They wait, they grumble, and then they move the moment someone offers tech plus touch. The consumer market is earlier in the same cycle – and mutuals get to choose which side of it they’re on.
The comparison is instructive in another way too. In SME banking, the human need is continuous – a business’s affairs are complex enough that the relationship itself is the product. In consumer banking, the need is episodic – concentrated in a handful of life moments. That actually makes the consumer version cheaper to deliver well: you don’t need an RM per member, you need brilliantly accessible humans at the moments that matter, funded by ruthless digitisation of everything else. Which, conveniently, is exactly the operating model a branch-holding mutual already has.
The Scarcity Play
This is where building societies’ position gets genuinely interesting.
Building societies now account for around 30% of all high street branches – more than double the 14% share held in 2012. Not because societies suddenly opened hundreds of branches, but because they kept theirs while everyone else left. And the sector holds roughly £490 billion of mortgage assets (31% of UK mortgage lending) and £485 billion of retail savings per the Bank of England’s latest Mutuals Landscape report – so this isn’t a cottage industry hanging onto branches out of sentiment. It’s a quarter of the savings market making a deliberate strategic choice.
In my experience, scarcity is the most underrated marketing force there is. When every other provider’s “contact us” journey ends in a chatbot loop, the institution where a member can sit down with an actual person isn’t offering legacy infrastructure. It’s offering a premium product.
The Trap to Avoid: Humans as a Cost Line
Here’s my worry for the sector. Under margin pressure, the temptation is to treat people as the expensive bit of the operating model and digital as the cheap bit – and to “transform” by swapping one for the other.
That’s the big banks’ playbook. SME banking shows exactly where it leads, and it has handed challengers a once-in-a-generation differentiator. Copying it would be strategic self-harm.
The smarter framing – and the one I’d put in front of any board – is this: digital exists to make the human moments better, not rarer. Every pound spent automating the routine should be explicitly reinvested in the quality of the human interaction. Automate the form-filling so the adviser spends the appointment advising. Use the data so the colleague already knows the member’s story before they sit down. That’s not digital versus human. That’s digital funding human. It’s the Allica (and also HandelsBanken) model, and it’s the model the mutual sector was practically born for.
The 2008 lesson applies here too: the institutions that invested through adversity came out the other side stronger. The same logic applies to people. The societies that protect and upskill their human capability through this margin squeeze – rather than cutting it to fund the tech – will own the most defensible position in UK retail finance: the provider that’s brilliantly digital and genuinely human.
The ‘So What?’
Three things, if you’re sitting in a society today:
- Stop apologising for your branches and your people. Reposition them. They’re not a legacy cost – they’re a premium service the rest of the market has abandoned, and 80% of consumers say they want it. SME banking has already proven customers will move for it.
- Get the digital basics flawless, fast. The human premium only works if the everyday digital experience is competitive. A clunky onboarding flow or app doesn’t make your humans look valuable; it makes your whole institution look slow.
- Measure the human, not just the digital. We obsess over app ratings and digital adoption. Start measuring access to humans at the moments that matter – speed to a real person, quality of complex conversations, outcomes for vulnerable members. What gets measured gets protected.
The neobanks have spent a decade proving you can build a bank without branches. SME challengers are now spending this decade proving the opposite case: that the winning model is tech plus touch. And belonging – membership, mutuality, being known – is the one product this sector has always sold.
Twenty years ago, a man in an Oslo focus group told me exactly how this would play out: digital for the basics, the human touch – as Bruce Springsteen would call it – for everything that matters. Two decades of transformation spend later, the data has finally caught up with him. The Boss had it right, and so did he. We’ve never been better placed to provide that human touch. We just need the digital plumbing to match.
Feel free to disagree, agree or suggest alternative views – happy to hear them all.
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