Smaller banks winning favour with consumers
The Net Promoter Score (NPS) for the Big Four Banks has scarcely recovered from the Banking Royal Commission, sitting at minus 1.6 for the six months to this February, and is significantly below the latest rating of 23.2 for banks outside of the Big Four.
The NPS of minus 1.6 was one of the lowest recorded since 2014. The fact that last February, prior to the Royal Commission, it sat at 2.8 before falling to minus 2.8 in November after hearings wrapped up showed the impact the inquiry had on customer sentiment toward the industry.
The rating for smaller banks of 23.2 however, was down only marginally from its pre-Commission level of 23.4. This reflected a longer-term trend toward such banks, with banks outside the Big Four having increased their NPS lead over their larger counterparts since 2014, from 19.5 to the current gap of 24.8.
ING had the highest NPS score of all banks at 51.8, up 9.3 points since January 2018. This was followed by Bendigo Bank at an NPS of 34, Bank of Queensland at 19 and Bankwest at 10.1. The Big Four were largely in the red however, with Westpac recording a NPS of -7.3, ANZ of -6.8, NAB of -5.6, and the Commonwealth Bank just sneaking into the positives with 3.8.
Roy Morgan industry communications director, Norman Morris, was unsurprised by the negative impact on bank NPS results over the last year, saying they had faced “a continuing barrage of negative publicity during and following the Finance Royal Commission”. The chart below showed the overall decline in bank consumer satisfaction since the Commission.
Source: Roy Morgan Single Source (Australia).
Roy Morgan calculated the NPS scored based on in-depth face-to-face interviews with over 50,000 consumers annually.
AUTHOR
Hannah Wootton
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
