Despite the current banking crisis – and the longest recession since 2008 – two in three (66%) Britons feel most loyal to their bank or building society, with only 8% of customers switching to a rival bank over the past five years.
However, according to the Loyalty Report by The Logic Group, this is no time for complacency as proposed changes to the banks – splitting retail divisions from investment arms – could lead to a mass exodus.
While most banks are now again offering switching rewards to current account customers, the number of those who switch pales in comparison to the 64 million-plus UK current accounts in existence (over 90% of the adult population has a current account).
Traditionally, the main reason identified for inaction has been that banks make it unnecessarily complicated to switch. Given that the switching process is being simplified, the report claims banks need to start educating customers and simplifying communications to help them overcome the feelings of perceived hassle, risk, uncertainty of service quality and trust.
“The recent events, including those from last week, should become a lesson for British banks in how not to exploit and dishonour customer trust and loyalty. The repercussions are not just for the protagonists or the industry alone, they erode Brand Britain,” said Antony Jones, chief executive of The Logic Group.
“The Loyalty Report highlights the access to trusting customers that UK banks have. Instead of crushing their confidence, banks should be encouraging this loyal customer base to mobilise the economy and stimulate growth.”
