European Digital Finance Landscape: Online Banking in the North, Cash in the South

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The North-South Split in European Online Banking Trends

The relationship between Europeans and digital financial services exhibits significant regional disparities. According to Eurostat’s Regional Yearbook, while Northern European regions, particularly in Denmark and the Netherlands, show high engagement in online banking, the situation in Bulgaria, Romania, and certain Italian regions in the South is notably different.

The term “digital divide” describes the gap between individuals who have access to and can effectively use the internet and digital technologies, and those who are excluded from these resources. This divide is categorized based on various factors, such as age, gender, education level, income, social group affiliations, and geographic location, which influence the disparity in digital participation.

According to Eurostat, in the year 2022, a notable 7.0% of the European Union’s population, aged 16 to 74, had not yet experienced internet usage. The region with the most substantial proportion of non-users, where one in five individuals (20.3%) had never accessed the internet, was Kentriki Elláda in Greece.

Source: Eurostat

Online Banking: A North-South Contrast

The divide is stark in online banking. In 2022, about 59.7% of Europeans engaged in internet banking, with over 90% participation in all Danish regions and nine out of twelve Dutch regions. At the opposite end, less than a quarter used online banking in Bulgaria and Romania. In Italy’s southern regions such as Calabria, Campania, Basilicata, Puglia, and Sicily, the usage of internet banking was below one-third.

Individuals Who Used Internet Banking in the Last Three Months Prior to the Survey. In Percentage (%)

Regional Differences in Italy

In Northern Italy, the figures for online banking are higher but still not reaching the European average: 55.6% in Piedmont, 58.6% in Veneto, 59.7% in Lombardy, with Trento province at 60.9%. This contrasts with the more traditional banking methods prevalent in Southern Italian villages.

Changing Banking Trends

Northern European countries are increasingly adopting virtual banks without physical branches. In response, traditional banks are diversifying their services, including online platforms, sometimes acquiring internet-based competitors.

Individuals Who Made Online Purchases in the Last Twelve Months Prior to the Survey. In Percentage (%)

Growth in Internet Banking and Online Shopping

From 2019 to 2022, there was a 5.1% increase in the use of internet banking in Europe. The growth, however, varies regionally. Spain has seen significant increases, particularly in Ciudad de Melilla (39.6%). Online shopping also shows disparity; in 2022, 68.0% of Europeans bought goods or services online, with the highest rates in Denmark, Ireland, France, the Netherlands, and Sweden. In contrast, in Bulgaria, Romania, Portugal, and Italy, especially in regions like Calabria, online shopping is less prevalent.

Topics: Eurostat Regional Yearbook digital finance analysis, Northern vs Southern Europe banking habits, Internet banking adoption in European regions, European Union’s digital financial landscape, Online and traditional banking contrasts in Europe, Digital divide in European financial services, Comparative study of European online banking trends

Source: Il Sole 24 Ore
Featured image: Unsplash

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