Poor customer service drives consumers to switch bank accounts – report

According to a recent worldwide survey carried out by UK-based provider of payment and enterprise fraud detection systems Alaric, in the six countries sampled – UK, US, UAE, Mexico, Australia and Malaysia – 27 percent of respondents said that poor customer service (either in their day-to-day dealings with the bank or after a fraud incident) was most likely to make them switch bank accounts. This was followed by 22 percent of polled consumers who said that their new bank offering better interest rates was the factor most likely to make them switch.

Interest rates were found to be a particular ‘push factor’ in Mexico, with a third of survey participants admitting better rates were the incentive most likely to make them switch. Attractive incentives, such as being offered money to switch, were rated most highly by 15 percent of those surveyed.

Interestingly, their new bank having a good track record for stopping fraud was identified by just four percent of polled consumers as the factor most likely to make them switch accounts, dropping to a mere two percent of UK respondents, but rising to eight percent of respondents from Mexico.

One in eight respondents in the UAE said that they would be most likely to switch bank accounts if the new bank offered better online or mobile banking solutions, something that was a key driver for less than five percent of polled consumers in the US, UK or Australia – perhaps showing that consumers in these countries feel they are already getting a good online or mobile banking service, or that there isn’t much difference between the banks.

Banking customers in the UK, Australia and the US were found to be the most loyal, with one in four revealing that they would be highly unlikely to change accounts at all – even if their bank delivered poor customer service or failed to stop fraud on their account. In contrast, only nine percent of the Mexico and Malaysia samples revealed that they were highly unlikely to change bank accounts.

This data has highlighted that, like the nature of any business, banks need to remain competitive. Financial institutions need to ensure they understand what motivated their customers to stay – and what might motivate them to leave – and do everything they can to keep them.