We’ve surveyed New Zealanders to find out which banks have the most satisfied customers.
What we found
Local banks are doing a better job of keeping their customers happy than their big Aussie rivals. Our survey shows locally owned Kiwibank, The Co-operative Bank and TSB Bank have the most satisfied customers. They’re also the least likely to be thinking about switching.
Eighty-seven percent of TSB Bank customers, 77% of The Co-operative Bank’s and 71% of Kiwibank’s were very satisfied with the service they were getting (see Overall satisfaction).
Aussie-owned ANZ, ASB, BNZ and Westpac couldn’t match these ratings. ANZ and Westpac were the lowest rated: only 52 percent of their customers were very satisfied with their bank’s service.
But it was Westpac that stood out for its sub-par showing across all performance measures in our survey. It earned the distinction as the only bank to consistently rate below average on everything from branch service to value for money.
Local bank customers place a high value on banking with a New Zealand-owned company. For two-thirds of TSB and Kiwibank customers, it was rated as the number one benefit of doing business with their bank.
Lower fees ranked second. Local bank customers were less likely to be paying monthly account fees and, correspondingly, more likely to feel their bank’s fees were reasonable.
Twenty-four percent of local bank customers reported paying fees.
Among Aussie banks, the proportion of fee-paying customers was significantly higher: on average, 47% paid monthly account fees.
Of those who paid fees and knew how much they were charged each month, the average amount was $25 – a tidy $300 a year. However, about 1 in 5 weren’t sure what they paid.
Reserve Bank data show the banks’ income from fees as well as commissions has increased. Last year, combined revenue from these sources totalled $2.218 million, up from $1.996m in 2014.
Banks’ revenue from fees also continues to influence consumer perceptions of the industry: just 35% of consumers agree charges are fair.
Regardless of who they banked with, the majority felt the industry’s profits showed they were charging too much.
While our survey found customer satisfaction varied markedly between local and Aussie-owned banks, there wasn’t a significant difference in the proportion of customers who had experienced problems.
About 1 in 8 consumers reported a problem with their bank in the last year. The most common issue was poor customer service, experienced by close to half (47%) of those who ran into difficulties. Incorrect charges were next (31%), followed by mistakes in processing (21%).
Last year, the Banking Ombudsman dealt with 2704 inquiries and complaints.
Nearly half (47%) of those who’d had a problem in the past 12 months felt it had been handled poorly. Just 1 in 5 thought their bank dealt with it very well.
Unresolved problems with a bank may eventually end up at the Banking Ombudsman. Last year, the office dealt with 2704 cases. The big four Aussie banks generated about 77% of these, although this was proportionally lower than their combined market share of 88%.
Consistent with our survey findings, customer service is the most common cause of complaints to the Banking Ombudsman. The main issues raised in complaints include failure of bank staff to act in accordance with the customer’s instructions and dissatisfaction with how banks collect debt.
More on the Banking Ombudsman
If you have a problem with your bank, you can use the free and independent Banking Ombudsman Scheme.