Banks that don’t challenge themselves will lose out to challenger banks

Research by CREALOGIX Group, provider of mobile banking solutions, has revealed that while half of consumers (51 per cent) have never changed banks, almost 82 per cent have experienced problems with their bank. The study of 2,000 consumers across the UK illustrates that while switching banks is not as common as switching other commitments, such as mobile phone providers, the rise of challenger banks and the Open Banking initiative might see more people open to changing providers. Banks need to start putting customer experience at the heart of their operations.

When asked what they would do if they found a better deal with a bank elsewhere, currently only 24 per cent would switch banks immediately. 41 per cent would contact their bank to see if they could match that deal. There is a slight generational divide, with 46 per cent of 25-34 year olds saying they would give their current bank a chance, versus 38 per cent of over 55s.

The study uncovered that millennials consider themselves almost twice as loyal to their bank as those in the 55+ age group (22% versus 12%).

Mike Bradford, CEO Crealogix UK said: “Those banks that focus purely on the changing habits of millennials should not assume that it is the younger generations who are the first to switch banks if standards are not met. It seems the older generations are more fickle. Regardless of generational habits, this survey shines a light on the need to really focus on customer experience as Open Banking and challenger banks change the landscape for consumers.”

“Long gone are the days when moving banks was made overly complicated by those eager to keep hold of their customers from cradle to grave. From the seven-day switch to the recent Open Banking initiative and API-driven banking, the power is being returned to the consumer. Banks need to change if they are to avoid the fate of the mobile phone networks – once all-powerful now transformed to mere dumb pipes,” Mike Bradford added. “Only those banks that start delivering a more personalised experience to drive engagement and loyalty will survive. The stakes are high.”

CREALOGIX is a fintech top 100 firm and a global market leader in digital banking. Its fintech solutions offer bank clients a better customer experience, greater security and effortless online money management. The CREALOGIX product and service range spans the areas of Digital Banking, Digital Payment and Digital Learning.