Banks trusted to keep money but not for financial advice–study
MANILA, Philippines – Majority of consumers continues to trust their banks to hold their money for safekeeping but does not consider them a primary adviser for their finances, research has revealed.
Of the 1,000 customers surveyed from across 10 countries in the Middle East and South East Asia, 75 percent said while they trusted their banks with their money, they did not consult them in other financial matters, said SunGard, a software and technology services company.
According to the research, consumers from the two regions are more likely to turn to family for help in personal financial decision-making since 37 per cent admitted having little or no financial knowledge which presented as a possible scenario for banks to deliver an improved client service.
“Despite the fact that banks in emerging markets enjoy a high level of consumer trust, this research illustrates that they are not capitalizing on this,” said Dean Young, vice president of product management for SunGard’s retail banking business.
“Banks in the Philippines enjoy a positive reputation on customer service and personalization. However the competitiveness of each bank is a driver for consumers to hold more than one banking relationship.”
Customer interactions
Furthermore, 95 per cent of respondents admitted to visiting their banks regularly. Of those respondents, 58 per cent said they wanted to get help or advice, 36 per cent were aware of security concerns with digital channels with 35 per cent preferring personal transactions.
The research also showed that digital channels have been subject to high disapproval ratings.
Of the 1,000 respondents, 55 per cent highlighted online banking and 45 per cent pointing to mobile banking services.
The dilemma provided another area of opportunity for banks as 47 per cent of consumers are not using the digital channels while one in two respondents expect the bank to deliver a better mobile experience in the future.
Quest for convenience
According to the research, convenience is the biggest factor of multi-bank relationships with 65 per cent of consumers citing it for having more than one financial service provider.
Also, 40 per cent of the respondents said that they have relationships with three or more financial service providers.
Product range was the second-highest factor for multi-bank relationships with 44 per cent ranking it the second of three factors.
Lastly, 25 per cent regard service personalization as the driver to hold more than one banking relationship with only about half of the respondents delivering a very personalized service and less than half felt their bank understands their needs.
“Consequently, more consumers are pursuing multiple banking relationships which can result in erosion of primary bank profitability and growth,” Young said.
He added that banks must invest in enhancing multi-channel propositions to encourage the staff in serving customers better.
“This is an opportunity for banks in the region. In order to use channels as differentiators, banks in the Philippines need to focus on building capabilities to deliver the right products through the right channels, and to deliver a consistent multi-channel experience to customers.”
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