04.What are you waiting for?
This survey shows that mutual society and second-tier bank customers are more satisfied than those of the big banks. The majority of respondents – 65% – are long-time customers who’ve been with their current institution (usually a big bank) for 11 years or longer.
So why don’t more people switch? Perhaps some Big Four customers just don’t realise what they’re missing. But there are other factors at play. Of the 76% of bank customers unlikely to switch for everyday banking in the next year, half stay because they’re satisfied with their bank, but of the rest, a third say it would be difficult to switch because they have several products with the same institution (see Why Bank Customers Don’t Switch, graph below).
We’ve been cleverly marketed to by banks who, like telcos, encourage us to bundle all our products with them, reducing the chances we’ll leave. There’s also the hassle of switching. “I need my bank, but I don’t like them,” said a member. “I like the idea of a community bank (such as Bendigo) but I just don’t have the time or effort to change.” Other customers believe there’s not much difference between banking institutions, making switching not worthwhile.
We also wondered if people consider their money to be safer with the Big Four, despite a government guarantee applying to customer deposits with all authorised banks, building societies and credit unions until October 2011.
In a recent Senate inquiry, Rod Masson of the Finance Sector Union spoke about the so-called flight to quality. “In home loans and in deposits, it has been particularly evident that consumers are feeling the need for security and are moving back to [the big banks]. So they completely dominate the market when you start to break down the number of accounts they hold.”
The fact is, the perception of security among CHOICE credit union and building society customers surveyed is just as high as that of bank customers.
How we survey
Our Community Insights team asked respondents to rate their overall satisfaction with financial institutions used for personal everyday banking, credit cards and property loans, as well as more targeted satisfaction levels in individual categories such as fees, interest rates and customer service.
The number of responses is shown in brackets in the tables. We report on individual institutions where at least 30 responses were received. We recommend greater caution in interpreting findings derived from smaller samples. Responses for individual institutions are included in aggregated group figures, such as “all building societies”.
Thanks to the 3003 CHOICE members who completed our survey in August 2009. The response was evenly split between magazine and online members.