NEW YORK (5/30/13)--Within the next six months, 10% of retail banking customers worldwide say they likely will leave their bank, and an additional 41% of customers say they are unsure if they will stay or go, according to the World Retail Banking Report 2013.
That indicates one out of every two banking customers are at risk of switching, said the report.
Credit unions will want to take steps to make sure the people who do switch banks, switch to credit unions.
Meanwhile, banks are being told to make their customers a more important concern. "With half of retail banking customers globally not feeling loyal to their bank, it's clear that banks need to close the gap and build customer-centricity into their DNA," said Jean Lassignardie, chief sales and marketing officer, Capgemini Global Financial Services.
One way to draw new members--or keep existing members--is to go mobile. "The future of retail banking is mobile," said Patrick Desmares with Efma. "By the end of 2013, there will be more mobile devices than people. Banks need to go where the opportunity is ... and that is mobile."
The report is an annual survey of 18,000 customers globally conducted by Capgemini and Efma. The results are worse for banks but not for credit unions. In the 2012 survey, less than half of customers said they might leave their banks.
"Quality of service" emerged as the single most important factor driving customers to switch banks across the 35 markets studied, with the exception of North America, where fees mattered most, followed closely by quality of service.
Positive customer experiences are strongly correlated with the trust customers place in their financial institutions, and with customers' belief that their financial institutions have a good understanding of their needs, said the report. However, trust in banks worldwide has been eroded by scandals, including the rigging of benchmark interest rates, antimoney laundering schemes and other controversies, it added. Today, 49% of all consumers don't completely trust their financial institution.
Customers traditionally were hesitant to change banks because of the perceived complications or barriers involved. Britain plans to stimulate competition by introducing portable account numbers and new rules that allow customers to switch accounts within seven days.
In the survey, banks in nearly every region improved the percentage of customers having a positive experience in 2013. Latin America witnessed the greatest increase at 11.9%, followed by Western Europe at 7.2%, and North America at 5.5%.
Eleven of 35 markets recorded an increase of more than 20% in the number of customers with positive experiences, according to the study. Conversely, nine markets saw a decline in positive experience. Fifteen markets remained even.
Customer satisfaction was greatest in North America, with Canada taking the top spot with a 61% rating and the U.S. following with 57%. Italy, Saudi Arabia, China and Brazil saw the greatest improvements in share of customers with a positive experience. Hong Kong had the lowest rating at 15%, and Japan scored 22%. The report attributed the low ratings to more demanding customers in these markets.
Forty-four percent of those surveyed say they are satisfied with the consistency of experience at their bank across channels, while 57% don't think there's a good product-channel fit, and 63% feel strongly that banks could do a better job understanding their needs and learning their preference.
Fostering service excellence is one of the three prongs of the Credit Union National Association's Unite for Good campaign toward reaching CUNA's strategic vision for the credit union movement, in which "Americans choose credit unions as their best financial partners."
To download the full report, use the link.