Within the next six months, 10% of retail banking customers say they will likely leave their bank, and an additional 41% of customers say they are unsure if they will stay or go. That means one out of every two banking customers are at risk of switching.
These findings come from the World Retail Banking Report 2013, an annual survey of 18,000 customers globally conducted by Capgemini and Efma.
The results are worse than the 2012 survey, when less than half of customers said they might leave their banks.
Customers have traditionally been reluctant to change banks because of the perceived complications involved. Britain is looking to tackle that problem and stimulate competition by introducing portable account numbers and new rules which enable customers to switch accounts within seven days.
Banks in almost every region improved the percentage of customers having a positive experience in 2013. Latin America witnessed the greatest increase at 11.9%, followed by Western Europe at 7.2%, and North America at 5.5%.
According to the study, 11 of 35 markets recorded an increase of more than 20% in the number of customers with positive experiences. On the contrary, nine markets saw a decline in their share of customers with a positive experience. 15 markets remained even.
The report found customer satisfaction was greatest in North America, with Canada taking the top spot with a 61% rating and the U.S. following close behind with 57%. Italy, Saudi Arabia, China, and Brazil witnessed the greatest improvements in share of customers having a positive experience.
Banks in the Asia Pacific region are on the other end of the spectrum, with Hong Kong having the lowest rating at 15%, and Japan scoring a 22% customer satisfaction rate. The report blamed more demanding customers in these markets.
In the research, “quality of service” emerged as the single most important factor driving customers to switch banks across the 35 markets studied, with the exception of North America where fees mattered most followed closely by quality of service.
Positive customer experiences are strongly correlated with the trust customers place in their banks, and with customers’ belief that their banks have a good understanding of their needs. But trust in banks around the world has been eroded by scandals including the rigging of benchmark interest rates, anti-money laundering schemes and other controversies. Today, 49% of all consumers don’t completely trust their financial institution.
Only 44% say they are satisfied with the consistency of experience their bank provides across channels. 57% don’t think there’s a good product-channel fit, and 63% feel strongly that banks could do a better job understanding their needs and learning their preferences.
“With half of retail banking customers globally not feeling loyal to their bank, it’s clear that banks need to close the gap and build customer-centricity into their DNA,” said Jean Lassignardie, Chief Sales and Marketing Officer, Capgemini Global Financial Services.
‘’The future of retail banking is mobile,” says Patrick Desmarès with Efma. “By the end of 2013, there will be more mobile devices than people. Banks need to go where the opportunity is… and that is mobile.”