Which bank do you trust to look after your cash? Our annual survey reveals the banks with the most satisfied customers.
From suspect sales practices to overcharging customers millions of dollars, the banking industry has racked up an impressive year of bad press. It’s little surprise our annual satisfaction survey shows bankers have an image problem.
Just 35% of consumers think banks have their customers’ best interests at heart. Seven out of 10 view the bumper profits being made in the industry as evidence fees are too high.
Only 47% agree banks can be trusted.
While the industry isn’t held in high regard, consumers are prepared to be more generous about the bank they do business with and need to trust to look after their money. Overall, 60% were happy with the service they were getting from their bank. That hasn’t changed since our previous survey, despite the industry’s year of negative press.
The local banks continue to do a much better job of keeping customers happy than their big Aussie-owned rivals.
The FMA and Reserve Bank review of the banking industry didn’t name names. But it did list cases where bank customers had been sold worthless products. In one case, customers were paying for products where the fees outweighed any benefits.
Failures in banks’ processes also resulted in consumers being overcharged due to:
Many of these instances are likely to breach the Credit Contracts and Consumer Finance Act. The Commerce Commission, which enforces the act, confirmed it had six open investigations into banks’ conduct.
The review also criticised banks’ complaint processes, finding “serious weaknesses” with some. In one case, bank staff manipulated customer records to prevent unhappy customers receiving satisfaction surveys because negative feedback could affect staff bonuses.
Our survey found one in 10 consumers reported experiencing a problem with their bank in the past year. However, ANZ customers were more likely to report problems (13%).
Poor customer service was the biggest problem: 40% of complainants reported it as an issue. Incorrect charges (26%) and processing errors (22%) were next.
A significant proportion (45%) thought their problem had been handled poorly. Just one in five thought their bank had dealt with it very well.
The banking review also highlighted the gaps in legislation that mean no one’s been keeping tabs on the sales culture of the industry and its impacts on consumers.
Banks have legal obligations to act as responsible lenders. But on their own, these obligations haven’t been enough to prevent consumers being sold poor-value products.
It’s clear that regulators need stronger powers to monitor the industry and impose penalties when banks flout the rules. Our survey found seven out of 10 consumers think regulators need to do a better job of monitoring the industry.
The government says change is on the horizon. In January, Minister of Finance Grant Robertson said it will be “taking a fundamental look at how we regulate financial institutions”.
As well as placing an obligation on banks to treat customers fairly, it’s promising beefed-up monitoring. “We need a regulator that will be able to monitor this conduct, with strong penalties for those who breach the rules,” Mr Robertson said.
While details have yet to be released, law changes are expected to be introduced this year.