Consumers Need Advice, Guidance from Banks, Study Finds
Savers are moving money around in search of better service, according to JD Power
- Written by Banking Exchange staff
High inflation and banking sector turmoil are affecting the financial health of bank customers, according to JD Power’s latest consumer survey.
The proportion of deposit customers classified as “financially unhealthy” by JD Power’s metrics has increased by nine percentage points over the past 12 months, the consumer research company reported.
The amount of customers with more than £10,000 in their deposit accounts has fallen as well, by 16 percentage points in the same period.
JD Power found that just a fifth (21%) of bank customers said they had received advice or guidance on their financial health from their bank in the past year. Those banks that had actively sought to help customers “reaped the rewards”, JD Power said, with these customers “significantly more likely to have opened a new account”.
Jennifer White, senior director of banking and payments intelligence at JD Power, said banks needed to support customers through difficult periods in order to improve satisfaction and build customer loyalty.
“It’s an incredibly tenuous time for both bank customers and financial institutions, and the need for trust between these two parties has never been more pronounced,” she said.
“Although our study was conducted prior to the recent high-profile bank crisis, the difficult economic conditions that contributed to the Silicon Valley Bank and Signature Bank failures have been building for quite some time.”
Customers are moving money, according to JD Power’s research, which could be due to poor satisfaction as well as a search for higher interest rates on savings. Just 28% of customers had more than $10,000 in deposit balances, down from 44% a year earlier, while those with less than $1,000 in deposit balances hit 30%, up from 17% 12 months ago.
Almost a third (30%) of primary bank customers have moved an average of 37% of their deposits to a secondary provider, JD Power said.
The study was based on a survey of 101,400 retail bank customers across the US.
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