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September 17, 2012

Consumers Take Control of Banking Relationships

Today’s consumers are taking control of their banking relationships, increasingly likely to change banks and expecting to be able to choose between a range of service levels and costs, according to Ernst & Young’s 2012 global consumer banking survey. The study, which questioned 28,560 banking customers across 35 countries, highlights how customers also expect to be financially rewarded for their loyalty.

Globally only 44 percent of customers say their bank adapts products and services to meet their needs. 70 percent of customers would be happy to disclose personal information if it improved the level of service and products they were offered.

The survey also reveals that loyalty reward schemes are on the rise. Twenty-seven percent of customers are enrolled in a scheme, up 50 percent from 2011. However, customers expect more – the overwhelming majority agreed that if you have three products or more with a bank you should get better service (86 percent), and that you should be charged lower fees or given better rates on your savings accounts (91 percent).

Consumers are becoming less loyal and increasing the number of banks they use. Consumers who use only one bank have fallen from 41 percent to 31 percent. The number of consumers planning to change banks has risen from 7 percent to 12 percent year on year and attrition rates have increased in several major markets. Poor branch experience (31 percent) and lack of personalized contact or service (26 percent) are rising up the list of reasons for changing provider, although dissatisfaction with high fees continues to be the most commonly cited driver of attrition, cited by 50 percent of respondents.

Banks have made progress in improving their communication channels. Both call center and mobile banking services have improved, with customer satisfaction up 8 percent and 16 percent respectively year on year, however the power of the consumer voice has overtaken banks communication channels.

Personal recommendations from family and friends are the top source of information about banking products, with 71 percent of consumers relying on this information as their primary source. Fifty-five percent of consumers refer to online communities or social networks for advice and a third of customers who use social networking use it to actively comment on the service they receive from their bank.

Source: Ernst & Young