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Thursday, 01 September 2022 10:32

Loyal Australian banking customers call for more gratitude from providers

By Pegasystems Inc.
Jonathan Tanner, Senior Director, Industry Principal Financial Services & Insurance APJ, Pega Jonathan Tanner, Senior Director, Industry Principal Financial Services & Insurance APJ, Pega

GUEST RESEARCH: Customers send a clear message to banks: Stop upselling products and services and start rewarding loyalty.

Pegasystems Inc. (NASDAQ: PEGA), the low-code platform provider that builds agility into the world's leading organisations, today unveiled the findings of its latest research into the state of customer experience in the Australian banking sector. In collaboration with Omnipoll, Pega conducted a national survey of 1,230 people aged 18+. The research reveals more than half (57%) of Australians feel their bank is more concerned with trying to sell new products and services than rewarding loyalty. 

The study shows that rewarding loyalty is becoming an increasingly important issue for consumers: 85% of customers said they feel long-term customers should receive the best rewards and rates. Conversely, only 53% of customers feel their bank provides this.

This desire to see loyalty rewarded is unsurprising given Australians’ long tenures with their banks: 61% of respondents have been with their main bank for 10+ years, while 47% have a tenure of more than 15 years.

Banks are falling short of customer needs

The research also revealed a variety of other areas where customer needs and expectations are not being met:

  • While 86% of customers expect their bank to quickly and transparently process requests (e.g. mortgage applications) and provide quick answers, only 72% agree their main bank delivers on this. 
  • Eighty per cent of customers don’t think they should have to continually repeat service requests with their bank - especially across different channels. However, only 64% feel their bank delivers on this.
  • Sixty per cent of banking customers are concerned with green, sustainable environmental business practices, but only 45% think this is a priority for their banks.

While banks are struggling in a variety of areas to meet customer needs, there are several important areas customers feel their banks are doing well. These include interacting on customers’ channel of choice (important to 83% of consumers, delivered by 79% of banks), providing clear and transparent information (92% / 82%), and providing financial products and service options relevant to the customer’s needs (60% / 51%).

Small banks are outperforming the Big 4

Nearly two-thirds (65%) of all Australians are with one of the ‘Big 4’ banks of Australia, and while the Big 4 ranked equally with other banks in ‘net customer satisfaction (81%), smaller banks were shown to be much better at going the extra mile and delighting their customers. Forty-four per cent of smaller banks’ customers reported ‘to be ‘very satisfied compared to just 33% of Big 4 customers. 

Regardless of whether customers are with one of the Big 4 or a smaller bank, a lack of loyalty rewards was revealed to be on par with interest rates as the main trigger of churn and are the two top things customers would like to see their banks change.

Quotes and Commentary

“Australian banks continue to adapt post-COVID but face a variety of challenges in keeping their customers happy,” said Jonathan Tanner, senior director, industry principal financial services & insurance APJ, Pega. “Cost of living continues to go up and financial insecurity is a concern for many Australians. It’s therefore unsurprising to see customers looking to banks to reward their loyalty and show more empathy in both their interactions and provided services. Many survey respondents cited receiving no loyalty rewards as a major churn point, and with the Consumer Data Right (CDR) now in effect for the banking sector, it’s easier than ever to get a better offer and change providers. Banks have long prioritized incentivizing new customers to join them, it’s clear they now need to start focusing on incentivizing their current customer base to stay.”

About Pega 

Pega provides a powerful low-code platform that builds agility into the world’s leading organizations so they can adapt to change. Clients use our AI-powered decisioning and workflow automation to solve their most pressing business challenges – from personalising engagement to automating service to streamlining operations. Since 1983, we’ve built our scalable and flexible architecture to help enterprises meet today’s customer demands while continuously transforming for tomorrow. For more information on Pegasystems (NASDAQ: PEGA), visit www.pega.com

 

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