New entrants to the banking sector are arriving thick and fast, most of them designed for riding the internet highway. However, the latest Global Consumer Banking Survey conducted by professional services firm Ernst & Young (EY) shows just what a fickle lot we consumers are when it comes to the organisations we trust to handle our money.
Statistics show that, while digital banking is becoming increasingly popular, one third of those questioned said that they don’t trust a bank that doesn’t have High Street branches. Furthermore, almost half of the respondents said they are not comfortable managing their finances solely online or by mobile, the same proportion still want face-to-face contact. The messages coming out of the survey appeared to be at odds, so what’s the answer?
To quote David Ebstein, EY’s Head of Digital Financial Services: “It is important that banks move at a pace customers are confident with and allow them to choose how they want to interact with their bank.” Presumably that means banks should stop forcing people to have what they think they ought to have and instead give them what they actually want.
It seems that consumers are perfectly happy to buy related domestic products like car loans and insurance over the internet because it saves them money. But they draw the line at the banking part, where all the products look pretty much the same and the differentiating factor is the quality of the service provided.
Other curious findings include the fact that 48% of UK customers trust their bank with keeping their money and personal details safe – they also believe a bank will look after them in the event of fraudulent activity. And yet a staggering 80% worry that they do not receive high quality unbiased advice and 82% don’t trust a bank to tell them if there is a product which better suits their needs.
As Mr Ebstein says: “Trust is the bread and butter of retail banking so it is concerning that so many customers feel they cannot trust the advice they are given."
First Direct, part of HSBC and one of the first on the scene in 1989, frequently pops up in surveys as the most recommended bank. The branch-less bank now has 1.25 million customers who obviously like the combination of being able to access services online, but still appreciate being able to talk to a human being over the phone on certain matters. Atom Bank, on the other hand, which is the new App only bank (known as a ‘neobank’) obviously has other ideas.
The competition in the market place is increasing and this report will be essential reading for the proposition developers at Masthaven, Atom Bank, OakNorth, Secco and any others that have yet to break cover. One can’t help but feel, however, that it’s a ‘generation thing’ that divides us and that a switch away from old-style banking to digital banking is the inevitable destination – albeit that total capitulation may still be a few years away.
You can read the full Global Consumer Banking Survey from Ernst & Young here.