" class="no-js "lang="en-US"> The customer experience in banking has “stood still” for five years
Monday, September 25, 2023

The Customer Experience in Banking has “Stood Still” for Five Years

FintechOS, the global technology provider for banks, insurance and financial services companies, today revealed new research that shows 63% of UK consumers believe the customer experience (CX) in banking has “stood still” for five years. After better financial terms, consumers will switch banks in pursuit of a better customer experience, especially Gen Z (18-24 years old) and Millennial (25-39 years old) generations. The data comes from a survey of 1,000 UK consumers in November 2020.

Key findings: 

CX has “stood still” in banking for the last five years 

  • Nearly two-third of respondents (63%), across all generations, believe the banking customer experience has stood still for five years.
  • Gen Z was the most positive group. 45% of Gen Z respondents said the banking CX had improved in the last five years, vs just 24% of Baby Boomers (56-74 years old).
  • 10% of Baby Boomers also thought the banking CX had got worse in the last five years.

Consumers will switch for a better customer experience 

  • After better financial terms (33%), consumers will switch banks in pursuit of a better customer experience (17%). This rises to 25% for Gen Z and Millennial generations, highlighting the growing importance of CX for younger generations. Why?
  • The arrival of digital-first banking providers has dramatically changed consumers’ expectations around CX with but only for Gen Z (72%) and Millennials (54%).
  • For Gen Y (40-55 years old) and Baby Boomers, the arrival of digital-first banks hasn’t altered their CX expectations. These generations care more about getting the best-priced service (44%) over a great customer experience (31%).

Loyalty, responsiveness, and personalization tops the list of frustrations 

  • Consumers are loyal to their banking provider (7.5 years on average), but they’re frustrated that they aren’t rewarded for this loyalty.
  • 45% of all respondents say not being rewarded for loyalty is the aspect of CX that needs improving most urgently.
  • And 46% of consumers vented frustration with responsiveness, saying “I’m simply not willing to wait or queue to access services” which rose to 61% for Gen Z consumers
  • And a quarter of consumers (25%) “expect personalized services” and expect “guidance and advice specific to them” from their bank.

Consumers are sympathetic around Covid-19—but that doesn’t mean they won’t leave 

  • When it comes to the Covid-19 pandemic, 69% of consumers believe their banking CX has remained the same during this time.
  • When asked if they agree with the statement “The Covid-19 pandemic has changed how people want to access and use services and it’s inevitable that it will take time for the customer experience to improve” 57% of Gen Z consumers agreed, demonstrating sympathy.
  • Although they are sympathetic, this doesn’t mean they’ll stick around—62% of Gen Z respondents said that the pandemic has made them more likely to switch providers.
  • Baby boomers are least sympathetic, with only 39% agreeing with the statement. But ironically, they’re most likely to stick with their provider given the pandemic (70%).

“As if a decade of razor-thin margins and reputational issues weren’t enough, the mix of challenges facing banks – from regulation to technology debt – makes it easy to see why so many now voice a commitment to improved customer experience as a legitimate differentiator in an increasingly competitive environment,” said Teo Blidarus, Co-Founder & CEO at FintechOS. “Critical to delivering a great customer experience is data and insight. Banks need to understand what their customers want and how they behave before they can hope to deliver a customer experience they will love. Each generation from Gen Z to Millennials to Gen Y and Baby Boomers think and act differently, and the customer experience must be tailored to their specific wants and needs.”

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