CBA, Westpac, NAB and ANZ have been accommodating during COVID-19, but years of damage has resulted in negative perceptions that are hard to shake.
The post Big 4 banks’ own customers don’t trust them appeared first on Motley Fool Australia. –
The big four banks in Australia have had a rough few years.
The financial industry Royal Commission rightly shamed them for unscrupulous practices, historic low interest rates were cut further to almost zero due to COVID-19, and share prices have plummeted as the banks slashed dividends.
Some experts have even declared the banks’ best days are behind them.
Now Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB) and Australia and New Zealand Banking Group Ltd (ASX: ANZ) face even more bad news.
Their own customers are distrusting of them.
The JD Power 2020 Australia Retail Banking Satisfaction Study found that clients of the major four banks are more likely than others to think their institution was profit-driven rather than customer-driven.
Many big four customers — 29% of them — also thought their bank was not transparent about fees. Only 17% of midsize bank customers thought the same about their institution.
It seems despite generous COVID-19 allowances like loan repayment deferrals, the big four still have some major image problems.
JD Power Australia head of banking and payments intelligence, Bronwyn Gill, said Australians are seeking trust in a devastating year of bushfires and pandemics.
“Bank brand authenticity has been crucial, with customers looking for genuine support during their time of need,” she said.
“The Big 4 banks have made progress repairing customer trust. However, a sustained customer-first culture will be needed to avoid losing customers to midsize banks who offer their customers a more authentic experience that corresponds with higher satisfaction.”
The study gave each big and midsize bank a score out of 700 to measure brand authenticity.
|Bank||Perceived brand authenticity (out of 700)|
|Bendigo and Adelaide Bank Ltd
|People’s Choice Credit Union||580|
|HSBC Holdings plc
|Suncorp Group Ltd
|Bank of Queensland Limited
|Bank of Melbourne||519|
|Source: JD Power, table created by author|
Heritage Bank was the highest ranked organisation for the second consecutive year with a score of 626.
Customer-owned banks dominated once again, with three of the top four from that category — Heritage, People’s Choice Credit Union and CUA.
Commonwealth, which this week announced a ban on home loan foreclosures, had the highest score among the big four, with 514.
The only midsize bank that did worse than the big four was ME Bank, which suffered a home loan redraw scandal earlier this year.
The study measured customer satisfaction in six areas: channel activities, convenience, product and fees, communication and advice, account opening, and problem resolution.
The 2020 edition surveyed 5,584 bank customers over May and June.
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