1 in 4 Say Banks Put Corporate Needs Ahead of their Customers
Consumers are starting to become less loyal and less engaged with their banks, according to new information from GfK and Personetics.
Only 31% of bank customers reported their banks understood their financial needs, and 28% said banks put their own corporate interests ahead of their customers.
Despite the weakened support in the banking sector, most consumers said they are going to stay with their current bank. Only 5% of participants were planning to switch banks in the next six months.
The unwillingness to switch banks is most likely the result of the way consumers view their banks. 40% see banks as necessary utilities, while only 27% feel their bank is a trusted partner. The majority of consumers may not feel like their financial needs are being met or appreciated, but they still believe they need banks to manage their finances.
“At a time when consumers have so many financial options, banks need to do more to shore up their all-important relationships with customers,” said Keith Bossey, Senior Vice President at GfK. “Our findings suggest that this trend is actually weakening engagement and loyalty, in no small measure because customers are not finding their bank helpful when it comes to improving financial well-being.”
Banks stand to greatly benefit if their customers see the financial institution as a trusted partner that helps them manage their day-to-day finances. Those customers are twice as likely to promote the bank and its services. In addition, the likelihood of moving to another bank drops from 34% to 7%.
The development of new financial opportunities for unbanked consumers, such as the possibility of post office banking and JP Morgan’s new prepaid card services, may prove to be a threat to the banking industry. While consumers may currently be unlikely to switch banks, they may choose to do so if their needs could be met outside of the traditional banking world. Unless banks are able to convert more of their customers into “trusted partners,” they may struggle to hold onto their audiences in the future.