75% of US Bank Customers Open to Switching as Expectations Gap Widens

Temenos and Celent have released research identifying a "switchable middle" comprising 75% of US banking customers who are only moderately satisfied with their current providers. For fintech leaders, this highlights a critical vulnerability in traditional banking loyalty, driven by legacy technology constraints that prevent institutions from meeting rising demands for personalization and AI-driven services.

What was announced

The report, titled "The Banking Expectation Gap: US Consumer Edition," surveyed 2,500 US consumers and over 400 global banking leaders to map the disconnect between service delivery and customer desire. It reveals that 62% of US banks have found customer acquisition and retention increasingly difficult over the last 12 months. Key areas of friction include payments, where nearly half of consumers express dissatisfaction, and security, with 42% unhappy with current fraud protection measures.

The research identifies specific "switch drivers" that could trigger a mass migration of deposits. Better rates and fees on credit products would tempt 51% of respondents, while 39% would move for superior digital banking features. While there is significant appetite for innovation—67% of consumers would use AI-powered conversational interfaces—trust remains a hurdle. Approximately 48% of customers harbor concerns regarding privacy and data security in AI-driven environments, while 34% worry about AI errors and inaccuracies.

On the institutional side, the "supply" of innovation is throttled by technical debt. Nearly half of US banks (46%) admit that legacy platforms are a direct barrier to enhancing customer experience, and 30% specifically cite these systems as a constraint on deploying Generative AI. Consequently, over 60% of banks are now considering a transformation of their core banking systems, with 22% marking it as a top investment priority for the 2026/27 period.

"The switchable middle provides both a threat and an opportunity for banks. Consumer demand is shifting from access and convenience toward personalization, trust, and guidance. Banks that can combine modern digital experiences with relationship-aware personalization and credible human support will be best positioned to retain customers and win share from both traditional competitors and digital-only challengers."

Michael Bernard, Principal Banking Analyst, Celent.

The companies involved

Temenos is a global leader in banking technology, providing cloud-native, AI-powered core banking and omnichannel solutions. The company serves a wide range of financial institutions, from large global banks to digital challengers and community banks, focusing on helping them modernize their operations and improve agility. Brian DuVal serves as the President, North America at Temenos, overseeing the firm's efforts in one of the most competitive financial markets in the world.

Celent is a leading research and advisory firm focused on technology for financial institutions. It provides strategic advice and market analysis to help banks, insurers, and wealth management firms navigate digital transformation. The firm is well-known for its "Dimensions" surveys and "XCelent" awards, which evaluate the performance and capabilities of technology vendors across the financial services landscape. Together, these organizations provide the infrastructure and the analytical framework necessary for banks to transition from legacy systems to modern, data-driven platforms that can support the next generation of financial services.

What FF News has reported before

FF News and its sister publications have frequently covered Celent’s role as a benchmark for excellence in the financial technology sector. Recently, Guidewire Dominates Celent XCelent Awards with Eight Wins for P&C Claims Excellence highlighted the firm's influence in the insurance space. Similarly, Five Sigma Achieves 'Luminary' Status in Celent 2026 North America P&C Claims Systems Report showcased Celent's evaluation of claims systems. In the realm of financial security, DataVisor Secures Triple Industry Honors for AI-Driven Financial Crime Risk Decisioning noted the importance of AI in fraud prevention, a key concern highlighted in the latest Temenos research.

What this means

This announcement signals that the "loyalty moat" once enjoyed by established US banks is evaporating. The industry is entering a phase where digital competence is no longer a differentiator but a survival requirement. When 75% of a customer base is "switchable," the pressure shifts squarely onto the CTO and COO to accelerate core modernization. The real challenge for the sector is the "trust-innovation paradox": consumers want the efficiency of agentic AI but remain deeply skeptical of its security. Banks that fail to resolve this tension, while still tethered to legacy cores, risk losing significant market share to more agile, cloud-native competitors.