Member Article

PwC advocates change as fewer than 1 in 3 North East customers trust their bank

PwC research has found that customers in the North East both lack trust in their banks and are also apathetic about getting a return on their savings.

According to the research fewer than one in three customers in the region now trust their bank although switching levels remain low.

54% of North East respondents did not believe regulatory reforms are enough to prevent another crisis and over a third in the region are concerned about not getting a good enough return on their savings.

The report reveals that although 43% of respondents in the North East believe regulation of the financial services sector has been strengthened in the wake of the crisis, a greater proportion (54%) do not believe the reforms that have been implemented are sufficient to ensure that history will not repeat itself.

The sense of apathy among customers is highlighted by the survey findings through generally low scores on the vast majority of questions and the combination of low trust scores and inertia.

For example, while just 31% of people in the region trust their retail bank, only 4% have changed their current account provider in the last year.

PwC’s senior partner in Newcastle, Bill MacLeod, said: “Tackling this apathy must be an over-riding priority for all financial services companies.

“Having a customer base that is both unresponsive and potentially volatile is the worst possible state of affairs for existing financial services providers.

“However, with switching levels relatively low and relatively high trust in banks to hold customer data, there is an opportunity for banks to reconnect with their customers.

“Those who don’t change now, and those who don’t make the right changes, risk going further down the road where the people they are trying to reach have stopped listening and will only pay attention again when something genuinely different comes along.

“The lack of trust in the financial services sector partly reflects a failure of providers to articulate the value they are offering, leading to suspicions that their overwhelming priority is to make short term profits.

“Providers must find new ways to explain the services they are providing, encourage consumers to voice their goals, priorities and expectations, and to respond to these.

“Taking genuine and conspicuous steps to satisfy customer goals, priorities and expectations, especially where there is no obvious short term gain – or even a clear cost – to the provider, is a response we’re starting to see more of.”