Retail banking customers in Canada have high expectations when it comes to using technology to conduct their banking business. Banks may not be meeting these expectations, especially in mobile, which may be driving the lower ratings for innovation provided by customers. According to our J.D. Power & Associates 2013 Canadian Retail Banking Customer Satisfaction StudySM, in 2013, 58 percent of customers perceive their bank as being technologically innovative, down from 66 percent in 2012.
While mobile penetration is not catching on as fast in Canada, compared with the United States (8% vs. 18%, respectively) banks could help raise mobile banking penetration and customer satisfaction by improving their mobile offerings. Providing a mobile banking option is critical in migrating routine transactions, especially deposits, out of the branch, helping to reduce bank costs while providing convenience for customers.
According to our study, during the past 12 months, mobile banking customers in Canada have used mobile to conduct a banking transaction 33 times, on average, compared with 51 times in the United States. Transactions may include making a deposit, transferring money from one account to another, finding a location, checking an account balance or paying a bill, depending upon the services offered by the bank.
A decision to switch banks is often driven by a mix of frustration with the previous bank and attractive offerings from the new bank.
Attracting new business within the retail banking industry is unique. While there are several variables that can “pull” customers toward a new bank, data from our J.D. Power and Associates 2013 Retail Banking Satisfaction StudySM has found that customers generally will not switch banks unless they are also “pushed” away from their prior relationship.
While poor service and high fees are most likely to push customers away, branch convenience, promotions and recommendations help to attract customers to a new bank.
What are you doing to protect your current relationships?
As the retail banking landscape continues to evolve, banking organizations need to always be tuned in to what customers expect from their bank and how they can provide them with a more satisfying banking experience.
As our J.D. Power Retail Banking Satisfaction Study moves to quarterly fielding and reporting for the 2014 study, banks are now better able to track their success with satisfying customers throughout the entire year!
The first quarterly wave of the 2014 Retail Banking Satisfaction Study was fielded in April 2013 and will be published on Tuesday, July 23rd.
We invite you to join us for a complimentary webcast during which we will discuss key findings from this study and address the following topics:
- How customers are interacting with their bank
- Trends in customer satisfaction and loyalty
- Changes we are seeing since the publication of the 2013 results
Date: Wednesday, July 24
Time: 2:00 – 3:00 PM ET
Overall customer satisfaction with retail banks improved significantly from 2012, largely a result of improvements made by big banks,(1) according to our J.D. Power and Associates 2013 U.S. Retail Banking Satisfaction StudySM released today.
“Many of the big banks have made great strides in listening to what their customers are asking for: reducing the number of problems customers encounter and, more importantly, improving satisfaction with fees,” said our own Jim Miller, senior director of banking here at J.D. Power and Associates
Below are a few highlights from the study:
- Fees have begun to stabilize and banks have helped their customers better understand their fee structures. Satisfaction in this area has begun to rebound, and is up by 14 points this year from 2012.
- One-third (33%) of customers say they “completely” understand their fee structure, compared with 26 percent in 2012.
- Fees also have been a major source of customer problems and complaints. The stability in fees, coupled with banks placing more emphasis on preventing problems, has lowered the proportion of customers experiencing a problem by 3 percentage points year over year, to 18 percent in 2013.
- While customers appreciate the personal service they receive at their branch, such transactions are slowly declining, while the numbers of online, ATM and mobile banking transactions are increasing.
- As banks roll out envelope-free ATM deposits and deposits by mobile phone, customers are finding it easier to handle routine transactions without needing to visit their branch.
“Successful banks are not pushing customers out of the branch, but rather providing tools that make it easier to conduct their banking business when and where it is convenient for them,” said Miller. “Customers are quickly adopting mobile banking, making it a critical service channel for banks, not just a ‘nice to have’ option.”
For study results by region, view retail banking satisfaction rankings at JDPower.com
For more information on this 2013 U.S. Retail Banking Satisfaction Study, please contact Holly Zagresky at (248) 680-6319 or via email at Holly_Zagresky@jdpa.com
(1)Big banks are defined as the six largest financial institutions based on total deposits as reported by the FDIC, averaging $180 billion and above. Regional banks are defined as those with between $180 billion and $33 billion in deposits. Midsize banks are defined as those with between $33 billion and $2 billion in deposits.
Original post by Banking.com Staff on December 28, 2012
As announcements go, it wasn’t a very big deal when the British Bankers’ Association said at the end of the year that it is urging its 200 member banks to participate in a broad, two-pronged initiative to boost the industry’s image. Part of the plan is to monitor “people’s concerns before they become massive scandals”—a worthy goal, to be sure. But this wasn’t an isolated symptom of the problem. At around the same time, a Financial Times survey of 93 Members of Parliament revealed that fully two-thirds of the legislators believe British banks should be required to create a stronger barrier between investment banking and what’s known as ‘high-street’ operations. More worryingly, this wasn’t a liberal push for more regulation—the number of Conservative MPs backing the idea is actually higher than their Labour counterparts. There’s already a proposal to create a ‘ringfence’ around retail banking, but the new research indicates that many think the changes don’t go far enough.
That’s really the recurring theme here. If 2012 was a year of major change for banking institutions and individuals around the world, then 2013 will require even more.
A tsunami of bad news throughout the year was capped off by the news late in December of massive fines levied against UBS. The Swiss banking conglomerate ponied up $1.5 billion to global regulators, including $700 million to the Commodity Futures Trading Commission (CFTC) alone, the largest such settlement in the agency’s history. The fines stemmed from the charges of manipulation directed primarily at the bank’s Japanese securities subsidiary, all part of the mushrooming Libor scandal. Continue reading ›
Original post by Banking.com Staff on December 4, 2012
In a recent blog on Banking.com, we explored how small businesses don’t always get the respect they deserve from the banking world. There’s no question that this sector of the economy is always vital, and increasingly optimistic. In fact, the number of businesses that report being ‘better off’ jumped from 16 percent in 2009 to 33 percent in 2012. This is also a market rich with possibility: on average, small businesses hold deposits four times greater and loan balances 15 times greater than retail banking customers.
And yet, this market continues to rank near the bottom in banking satisfaction. So what’s going on—and what can the industry do to make thing better? The new J.D. Power and Associates 2012 US Small Business Banking Satisfaction Study, a comprehensive research report that identifies and highlights the situation described above, digs deeper into the problems and identifies many of the pain points.
As mentioned in the previous blog, credit is still the primary issue, but it’s not the only one. The J.D Power study lays out more fundamental problems too. In particular, while small businesses are sometimes lumped in with retail banking, there are major differences between the two. Continue reading ›