What is Driving Customer Satisfaction in Banking?
The customer’s definition of service has changed – it is no longer only about being fast, efficient or convenient, but about how good the bank is in supporting the customer during challenging times like complexity and inflation.
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How do customers around the world view satisfaction? We took a world tour of reports that measured customer satisfaction and distress to understand if there is a pattern to identify how banks can make strategic plans for the future.
Singapore is Boosting its Online Banking Security
When the SMU Institute of Service Excellence (ISE) released the Finance and Insurance industry sectors’ findings from the Customer Satisfaction Index of Singapore (CSISG) 2023 national study, the results showed that customer satisfaction with the finance sector in the Republic had increased. The positive sentiment among customers was a consequence of the steps by banks and the government to boost their online banking security. The study also showed declining interest in newcomer digital banks.
The survey revealed that customer perceptions of quality were driven by considerations of whether banks had their best interests at heart, and whether products and services were available when they wanted them.
Since early 2022, all banks in Singapore have removed clickable links in e-mails or SMSes to their retail customers.
The Singapore Police Force (SPF) took this action after a slew of cases of scammers impersonating banks or bank staff to obtain victims’ banking credentials via SMS.
Britain Puts Pressure on Banks to Raise Their Game
Recently, following its investigation into the retail banking sector, the Competition and Markets Authority (CMA) made it compulsory for all relevant banks to take part in such surveys, so customers get the full picture. Account providers must display their ranking prominently both in branch and on their websites and apps.
More than 34,000 personal and banking customers in Britain rated the quality of their bank’s services after the CMA made it compulsory for large banks to take part in the twice-yearly surveys.
The top-ranked personal current account providers in Great Britain in 2023 are:
- Monzo (1st)
- Starling Bank (2nd)
- First Direct (3rd)
US Banking Customers Battle Between Satisfaction and Trust
A report by GFT’s Banking Disruption Index revealed that 58% of Americans aren’t happy with their bank amid economic uncertainty and the collapse of several financial institutions earlier last year.
However, despite unhappiness, consumers said they are not willing to change their bank, with 78% saying they still trust them even after the collapse of Silicon Valley Bank (SVB).
The US remains an outlier in this regard when compared to European banks. When it comes to customer experience, it seems maintaining trust does not seem to be as important as digital transformation initiatives. But traditional banks could soon lose out to challenger banks, which focus more on seamless, UX-focused offerings.
In times of uncertainty, a good deal stands out. Around 40% of US consumers said that low or no banking fees increase their trust in the institution, while 32% said being able to access customer service 24/7 was another pull factor in establishing trust.
India’s Banking Authorities Say No Room for Complacency
Consumer confidence touched a four-year high in September 2023, continuing on its recovery path, the Reserve Bank of India (RBI) said. India deals with public banks that are still working towards increasing inclusion among unbanked populations, and private players where digital transformation is key.
A key initiative for public banks has been the EASE
Reforms Index – a framework launched in 2018 to assess and improve the performance of Public Sector Banks (PSBs). It refers to “Enhanced Access & Service Excellence” reforms. The initiative is part of a comprehensive strategy focusing on customer responsiveness, responsible banking, credit off-take, deepening financial inclusion, and digitalisation.
The RBI is also concerned about whether existing government guidelines were good enough in today’s rapidly digitised and complex financial landscape.
The move was made after it was reported that of the approximately 10 million complaints lodged every year, operations in accounts and loans accounted for about 38%, but the share of technology-related issues (internet, mobile banking, cards, ATMs) at 46% has been striking, though not completely unexpected given the rapid changes in technology and digital infrastructure.
In the private banking sector, a recent survey revealed that 78% of bank customers now prefer mobile apps for routine transactions. Digital banking users are expected to cross 3.6 billion globally by 2024.
Modern customers in India are reacting positively to banks’ digital infrastructure investments. For example, 65% of customers reported increased satisfaction with banks that offer personalised services. There has been a 30% increase in investment in data analytics solutions by banks for personalisation purposes.
GCC Studies Net Sentiment as a Composite Metric to Gauge Customer Satisfaction
KPMG has collaborated with DataEQ on the region’s first-ever GCC banking sentiment index, designed to quantify the experiences and sentiments of consumers within the Gulf Cooperation Council (GCC) banking sector.
Reputational Net Sentiment was spearheaded by the UAE and closely followed by Qatar. The UAE garnered praise that accounted for 21.1% of its conversation.
Qatar made significant progress with a positive Net Sentiment score of 7.8%. A variety of factors contributed to this, including favourable financial performance and the introduction of much-anticipated remittance services.
Saudi Arabian consumers were the most engaged online, as Saudi banks dominated the GCC’s banking conversation.
Digital is Closing the Customer Satisfaction Gap for South Africa’s Banks
All of South Africa’s top banks increased their public perception over the past year.
- FNB retained its top spot as the most favoured bank among South African customers, climbing its net sentiment results from 37.5% in 2022 to 41.9% in 2023.
- On its heels was Discovery Bank at 40%, which increased its net sentiment by 32.1%, climbing from fourth position in 2022 to second.
- This pushed last year’s second-most favoured bank, Absa, to third after it increased its net sentiment by 11.1% over the past year.
It’s easy to spot the friction for customers. Operational complaints lodged against banks were similar – mainly relating to “poor customer service and digital experience that did not always meet their customers’ needs.”
Standard Bank recorded the lowest operational net sentiment, which was pinpointed on issues that included unresponsive support and delayed accident claim processes.
The data was revealed by DataEQ which published its 2023 South African Banking Sentiment Index. The index tries to determine how consumers view the big retail banks in the country by analysing millions of social media posts over a year and categorising them by their general sentiment.
For the 2023 report, over 4.3 million social media mentions of the country’s banks were tracked.
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