Banks struggle to increase ‘share of wallet’

Commonwealth-Bank-of-Australia/bankwest/roy-morgan/

17 January 2018
| By Hannah Wootton |
image
image
expand image

Bank customers do not want to increase the ‘share of wallet’ with individual banks, but would rather keep their funds diversified across a range of providers, according to Roy Morgan’s latest Single Source survey.

The survey, which questions over 50,000 consumers per annum, found that large banks capture just over half of their customers’ overall banking wallet value.

In the year to November 2017, the Commonwealth Bank of Australia had the highest ‘share of wallet,’ being entrusted with 58.6 per cent of their customers’ funds. BankWest had the second highest, with 56.2 per cent.

Banks struggled to increase their ‘share of wallet’ though, with the ten largest consumer banks remaining largely steady in what portion of their customers’ overall funds they hold over the last four years.

In that time, five of those banks fractionally increased their share by up to 3 per cent. Four decreased their share by 2.6 per cent or less, and the Bank of Queensland’s share fell 7.6 per cent.

As the graph above shows, despite these changes the ‘share of wallet’ stayed largely consistent at a bit over 50 per cent.

Norman Morris, Roy Morgan industry communication director said that there were many reasons banks had struggled to increase their share of customer’s funds.

“Attempts to cross sell banking products to existing customers in order to increase ‘share of wallet’ have had little impact, most likely due to a number of reasons, including insufficient benefit to consumers to consolidate banking with one bank, increased competition from new and existing providers, diversification of risk and general apathy and effort regarding changing providers,” he said.

Morris said that the average consumer engages with around four financial services providers to cover their full range of needs.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

1 month 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months ago

Entireti has unveiled the new name for the AMP financial advice businesses that it acquired last year....

4 weeks ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

2 weeks 6 days ago

Minister for Financial Services, Stephen Jones, has provided further information about the second tranche of the Delivering Better Financial Outcomes (DBFO) reforms....

1 week 4 days ago

TOP PERFORMING FUNDS