Customers can bank on good service, but there’s room for growth

18th Nov 2015

Customer service is improving, but the banking sector must make it easier for customers to take charge of their accounts, the Competition and Markets Authority (CMA) has claimed.
 
As part of an in-depth investigation into the £16bn current account and business banking sectors, the CMA has found that banks need to work harder to compete for customers. According to the UK’s primary competition and consumer authority, just 16% of customers looked at alternative accounts in 2014 and only 3% made a switch. Because too few customers are switching, the CMA believes banks do not have strong enough incentives to compete for customers through better products or services.

However, despite calls for banks to work harder, data from the Institute of Customer Service shows many banks are taking steps in the right direction. Customer satisfaction for the banking sector has extended its lead over the UK Customer Satisfaction Index (UKCSI) average, with an increase of 0.9 since July 2014. The industry is now ranked fourth out of 13, with a UKCSI sore of 78.6, climbing three places since January 2015. Customers cited the sector’s approach to complaint handling as its biggest improvement. 

The Institute’s chief executive, Jo Causon, believes banks should continue to build on these successes, and place customers at the heart of all board decisions. “Quite simply, customer service needs to be a key strategic focus at the top level of organisations within the banking and building societies sector,” she says. “Those businesses that do not recognise this will see their customers switch to their competitors and lose market share.” 

To read a summary of the CMA’s provisional findings, click here.

Share this