FILE PHOTO - People walk in front of the Hauptbahnhof central railway station in Zurich, Switzerland June 23, 2016. REUTERS/Arnd Wiegmann

ZURICH (Reuters) - Only about half of population in banking-rich Switzerland uses online banking services, a representative survey conducted by the Swiss National Bank (SNB) among 34 banks showed on Tuesday.

The SNB surveyed bank customers’ demand for electronic and mobile banking offers to make payments, the area where digitalization in banking is more advanced than in mortgage lending, the central bank said.

“Overall, the banks have not yet reached their digitalization targets,” the SNB said.

Swiss banks are expecting financial transactions to become increasingly digital, which presents opportunities for cutting costs while improving the quality of service, the SNB said.

However, the survey also found risks linked to increasing competition from new market participants such as big technology firms or online banks that could lead to further margin pressures.

Increasing competition will also mean less customer loyalty, with the banks believing “customers are less likely to maintain a permanent relationship with a single financial institution in the future, and will instead increasingly turn to different intermediaries from the banking and non-banking sectors to find the best service,” the survey showed.

In wealth management, the traditional playground of Swiss banks, digital services are still the exception, with half of the banks surveyed indicating the digitally managed assets represent less than 1% of total assets under management.