More than 8 million switch banks

| December 7, 2007 | 0 Comments

According to a nationwide survey by data provider, Pitney Bowes Group 1 Software, more than 8 million people have switched their bank so far this year due to dissatisfaction with its services and staff. This figure represents 18.3% of the market whereas the rate in 2003 was just below 8%.

The survey established that Britain is the defection or ‘churn’ capital of the West, other industries such as mobile phone, internet and utility providers have high rates of defection but the banking industry has the highest proportional increase in dissatisfied customers over the last 4 years.

Across Europe, France has the most satisfied banking customers, with a defection rate of 16.6%, while the US has the highest at just over 25% of all customers.

Andrew Greenyer of Pitney Bowes, said it seems banking can no longer rely on customer inertia. Traditionally, churn levels have been in the sub-10% range, but have now soared to practically the same level as the mobile phone industry on average across Europe.

Mr Greenyer added as the branch network comes back into favour as a worthwhile element of customer service, we can expect to see high value customer privileges and rewards being delivered through this channel.

According to a second report released from research group Coleman Parkes, roughly half of those surveyed said they switched because their bank was not recognising them as a valuable customer and due to its ‘unhelpful staff’. In general, customers want more personalised, informal contact from their bank.

More than 60% of them added that banks are still too impersonal when communicating with me, they need to be more informal. However, over 60% of those banks across Europe surveyed said that they cannot always access an individual’s data in order to communicate with them one-to-one.

The survey established that just under half of UK banks use call centres to communicate with their customers, although most plan to shift to more direct methods of contact such as online instant chat and digital TV over the next 3 years.

Ian Parkes of Coleman Parkes added banks cannot afford to make mistakes. Poor customer service and a major error by the bank are 2 of the top 3 issues that will force a consumer to switch banks, so banks need to concentrate on a high level of customer service and quality of information management.

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