Aggressive forecast from Forrester here.  Hat tip Netbanker.  Go there for their analysis.

Online banking adoption continues its upward trajectory, as evidenced by a 27% growth rate in 2005. Expect this trajectory to continue during the next five years: By 2011, Forrester expects online banking adoption to grow by 55%, to roughly 72 million households.

In 2011, 76% of online households will bank online. The largest adoption growth will come from the Gen Y segment, and in 2011, 85% of Gen Yers will bank online.

Source: Forrester Research: US Online Banking: Five-Year Forecast

I think this is perfectly rational.  By 2011, baby boomers are in the minority, with Gen X/ Y and millenials in the majority.  If you assume most of the latter are using online banking, then only 1/2 of baby boomers have to be online banking to make up 76%.

Relevance to bankwatch:

Aside from the precise percentage – The key for banks lies in the fact that the majority of their customers will not regard branches as their primary Bank contact.  What will they have to do to ensure customer contact/ interaction, and therefore loyalty is maintained?  Online Banking is already a core element defining bank loyalty, and with only 24% of customers NOT using online banking, at what price will Banks focus primarily on branch development?