NatWest Bank has launched a new student proposition aiming to acquire full-time students as customers. Based on data from GlobalData’s Financial Services Consumer Survey, the focus point for NatWest will be those aged around 18-24 regarding who is likely to become a student in the next few years or who has become a student in the last two years. GlobalData Financial
The new offering from NatWest has the potential to acquire customers from Barclays and even customers from some fintech banks, despite 71% of 18-24-year-olds preferring alternative providers in the UK when asked: “If you were to open any of the following financial products and services, which type of provider would you prefer to use?”
Given that many neobanks do not have specific student propositions in place, NatWest may have a slight edge here.
The NatWest student proposition offers a £50 ($68) cash incentive and a four-year Tastecard membership, which provides discounts and offers at selected restaurants, cinemas and retailers. In addition, the new product offers students a £2,000 interest-free overdraft, available in their first year of study.
Barclays also offers a student proposition called Student Additions, which offers interest-free overdrafts and provides access to Perlego, an online library of academic and non-fiction titles.
If Student Additions is a student’s first current account with Barclays, they will receive a free 12-month subscription to Perlego, meaning there is no fully free tool offered as part of the package, with the proposition offering little else at present.
NatWest can win market share from Barclays
In our view, the Barclays proposition lacks excitement and lacks what students are most likely to be attracted to. The Perlego access is no longer free after only a year of use, and there are no other incentives – apart from the overdraft – that would appeal to students.
NatWest has an excellent opportunity to acquire students and retain them in the long term as it builds and develops on its retention strategies.