57% of consumers are frustrated with their high street bank with the top frustrations being cited as unfair bank charges, branch closures and IT failures, according to new research.
The report entitled ‘Are Banks Losing the Innovation Game?’ by Financial regulatory framework compliance experts, Neopay, queried 1,000 UK adults on their experiences and relationship with high street banks.
Despite the industry performing well on customer service when compared to other everyday service providers, such as energy companies or local authorities, there is evidence of growing frustration with certain aspects of banking services. When asked about recent experience with their bank, 57% of customers expressed some level of frustration.
Nearly a quarter of people (24%) were frustrated by unfair bank charges, such as when going overdrawn, and 18% found branch closures annoying. A further 18% found IT failures such as being unable to access an online account as disruptive.
For over a quarter of bank customers (26%) these problems are perceived to be getting worse, compared to just over a fifth who reported an improvement (21%), indicating a net reduction in total satisfaction with banks over the last year. As a result, customers are flocking to companies offering alternative ways to manage transactions, such as GlobalWebPay.com and APS’s Cashplus account.
The report cited the biggest frustrations with banks as being:
- Unfair bank charges (24%)
- Branch closures (18%)
- IT failures (18%)
- Delays in my balance updating (16%)
- Mistakes (13%)
- Scandals (12%)
- Security breaches (12%)
- Lack of opportunity to talk face-to-face (12%)
- Lack of opportunity to talk over the phone (9%)
Scott Dawson, commercial director at Neopay, said: “Our research shows that banks do perform well on customer service when compared to other everyday service providers, which is to be expected. They are well-resourced and highly regulated organisations that work hard to manage the millions of customer engagements they undertake each day.
“However, while overall customer experience is satisfactory, there is clear evidence of frustrations with certain aspects of the service and these problems are opening the door for other innovative organisations wishing to provide financial services. If the banks lag behind, customers are going to be more receptive to other providers who can offer a more customer-centric approach.
“All of these issues and changes are creating opportunities for other companies, like e-money organisations, to encroach on the traditional monopoly of the banks. Although e-money can’t tackle all of the customer frustrations identified in our research, there are plenty of areas where they can. For example, by reducing fees and charges by moving money more efficiently and finding solutions for specific customers, like children and teenagers.”