A new study by the Malta Financial Services Authority (MFSA) reveals that over 60 per cent of clients are now enrolled in mobile or internet banking.

This increasing reliance on digital financial services has led to a marked decrease in physical branch visits for cash services and outward payments between 2022 and 2023. The MFSA attributes much of this shift to the COVID-19 pandemic, which accelerated the adoption of digital tools across the financial sector.

The MFSA’s thematic review aimed to evaluate how local banks are adapting to technological changes and to measure the effectiveness of their digital offerings. This assessment supports the European Union’s Digital Strategy, which seeks to foster a human-centric digital economy. The review examined various aspects of digitalisation, including mobile and internet banking usage, chatbot functionality, ATM and branch activity, card usage, and the availability of online financial products.

The report notes that while digital banking adoption is increasing, a portion of Malta’s population still values face-to-face interaction, especially for complex financial needs. This dual demand underscores the importance of banks maintaining both advanced digital services and traditional customer support.

Commenting on the findings, Sarah Pulis, Head of Conduct Supervision at the MFSA, stated: “The digital transformation within Malta’s banking sector is evident and commendable. However, it is crucial to recognise and respect the diverse preferences of our community. While many customers embrace digital banking for its convenience, others still value personal interaction. Our banks must continue to cater to both groups, ensuring inclusive and accessible services for all.”

The MFSA noted that many banks are already making strides in their digital capabilities. Between 2022 and 2023, there was an increase in issues resolved through chatbots, reflecting improvements in their efficiency and user-friendliness. Several banks are exploring further enhancements, such as enabling appointment scheduling via chatbots and providing services in Maltese.

A key focus for the coming years is the implementation of online client onboarding, which most credit institutions plan to adopt by 2025. This innovation aims to reduce the need for physical branch visits. Banks offering online onboarding report higher uptake among younger demographics, although the service is gradually gaining traction with older clients as well.

The MFSA remains committed to overseeing the digital transformation of Malta’s banking sector, ensuring that these advancements align with regulatory standards while enhancing consumer access and security in the financial ecosystem.