Banks and building societies must continue to improve levels of customer
satisfaction if they are to rebuild trust and stop people switching
accounts, according to the latest UK Customer Satisfaction Index (UKCSI)
This advice comes after account switching was again thrust into the spotlight with the FCA recommending that the process is made even easier by introducing account number portability. More than a million people have already switched bank accounts since last year and if the recommendations are adopted banks can expect more people to switch accounts.
This research shows that customer satisfaction drives trust and loyalty. Banks and building societies that have higher scores in the UKCSI are on average more trusted by their customers and perform better on measures of loyalty – intention to remain a customer, repurchase and recommend to others. These latest findings underline the importance of customer service in influencing customer behaviour and business performance.
The 2015 UKCSI ranked Banks and Building Societies as the fifth highest-scoring sector (out of 13) for customer satisfaction with a score of 78.4 (out of 100). The sector now scores 2.4 points higher than the UK all-sector average of 76.0. The banking sector has improved complaint handling by 0.5 points since July 2014 and was one of only two sectors to improve customer satisfaction scores.
Jo Causon, CEO of the Institute of Customer Service, comments:
“With the government’s new seven day switch regulations coming into play last year, the banking sector has, it would appear, started to focus on customer service. This seems to be paying off but there’s still some way to go and the environment looks likely to get more competitive. Across the banking and building society sector there are examples of sustained customer service performance, however there is also a wide disparity of performance creating two distinct tiers of customer service.”
With a UKCSI score of 86.7, First Direct continues to be the highest scoring organisation in the Banking and Building Societies sector. However, there are significant disparities in performance across the sector with nine organisations scoring below 80 points, and the lowest score in the sector only 75.1. There are also contrasts in the changes to UKCSI scores for organisations over the past year.
Three banks – Santander, HSBC and Bank of Scotland – have improved their UKCSI score by more than a point since June 2014. But four have registered a drop of one point or more over the period, underlining the variety of performance in the sector.
Between July 2014 and January 2015, the average UKCSI score for Banks and Building Societies actually improved by 0.7 points, compared to a 0.3 point drop in the UKCSI all-sector average. This is the first improvement in the banking sector for over a year and sees it overtake the Insurance sector for the first time.
Up until July 2014, the Insurance sector had outperformed the banking sector but it has now seen customer satisfaction fall by 1.2 points since July 2014, well above the all-sector average of a decline of 0.3.
“This is just the beginning, many banking organisations are still performing below the all sector average offering further scope for improved business performance through customer service. With consumers more likely than ever to recommend on the basis of a good experience and share poor customer experiences with friends and colleagues, it is a critical time for the sector to make improvements in this area.
“Banks and building societies must continue to focus on the customer experience if they want to appeal to customers as more and more evidence emerges that customer service directly impacts an organisation’s bottom line and for a highly competitive sector such as banking where switching accounts is likely to become even easier this is incredibly important.”
(Source - Institute of Customer Service Press Release)