Category: Banking|Financial ServicesCanada

Satisfaction Rises among Bank Customers in Canada, JD Power Finds

2024-10-14

jillian.breska

TORONTO: 17 Oct. 2024 — After a few years of decline and stagnation, it appears that customer satisfaction with banks in Canada is on the upswing, according to the JD Power 2024 Canada Retail Banking Satisfaction Study,^SM released today. The study finds that customer satisfaction with Canada’s largest banks (Big 5) has improved 8 points to 611 (on a 1,000-point scale) this year. Similarly, Canada’s mid-size banks experienced a 7-point increase.

The improvement in satisfaction comes against a backdrop of cautious optimism among bank customers about the outlook of both their personal finances and the economy. According to the study, bank customers are a bit more positive about the future of their personal finances, with their confidence level inching up to 5.78 (on a 10-point scale) from 5.68 a year ago. Their outlook on the economy is even more bullish, up to 5.02 from 4.84 in 2023.

“The improvement in customer satisfaction is great news for the Canadian banking industry, but it’s important that the industry focuses on leveraging the momentum,” said Jennifer White, senior director of banking and payments intelligence at JD Power. “With 63% of customers also having deposit relationships with at least one other financial institution, the risk of losing deposits to a competitive institution still lingers. Banks need to find ways to elevate their client relationships from transaction-based to more meaningful value-add offerings that build trust and enable seamless services.”

Following are some key findings of the 2024 study:

• Key Satisfaction Driver: Trust is the most influential element of customer satisfaction, and every small occurrence that dents it, opens the door a bit wider for customers to switch banks. The study shows that the top three actions that damage trust are unexpected fees (54%); blaming the customer for an error (32%); and bad banking practices reported in the media (27%).
• Branch experience lagging: Although banks and customers are adopting online and mobile banking at a rapid pace, 49% of bank customers opt to use both digital and branch services. With such a significant proportion of customers visiting the branch, only 10% receive all four service-related best practices at the branch: greeting by name; offering to assist with other financial issues and needs; mentioning other ways the bank can help; and genuinely thanking them for their business. The study finds that delivery of branch service best practices can lift customer satisfaction by 109 points.
• Fees and poor service facilitate attrition: Among customers who intend to switch banks, the top two reasons are charged too many/high fees (32%) and poor service experience (30%). Customers also cited promotional offers from other banks (27%) as a leading driver of customer attrition, meaning that, despite customers’ potentially high overall satisfaction, they are often keeping an eye on alternative banks.

Study Rankings

RBC Royal Bank ranks highest among Big 5 banks with a score of 623.

Tangerine Bank ranks highest among mid-size banks for a 13^th consecutive year, with a score of 684. ATB Financial (653) ranks second and Simplii Financial (649) ranks third. 

The Canada Retail Banking Satisfaction Study, now in its 19^th year, measures customer satisfaction with Canada’s large and mid-size banks. The scores reflect satisfaction among the entire retail banking customer pool of these banks, representing a broader group of customers than solely the branch-dependent and digital-centric segments. The study measures satisfaction across seven factors (in order of importance): trust; people; account offerings; allowing customers to bank how and when they want; saving time and money; digital channels; and resolving problems or complaints.

The study is based on responses from 14,460 retail banking customers of Canada’s large and mid-size retail banks regarding their experiences with the financial institutions. The study was fielded in two waves in January-February 2024 and in June-July 2024.

For more information about the Canada Retail Banking Satisfaction Study, visit https://www.jdpower.com/business/retail-banking-study-1.

About JD Power
JD Power is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behaviour, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 55 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business.

Media Relations Contacts
Gal Wilder, NATIONAL PR; 416-602-4092; [email protected]
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

Bank Customers in Canada Still Feel Economic Pinch, Look to Banks for Financial Advice, JD Power Finds

2024-06-25

jillian.breska

TORONTO: 27 June 2024 — Although interest rates and inflation have started to trend downward, many bank customers in Canada are still feeling the economic squeeze and the majority of them express interest in receiving financial advice from their bank, according to the JD Power 2024 Canada Retail Banking Advice Satisfaction Study,^SM released today. Nearly two-thirds (65%) of bank customers are experiencing some level of financial distress¹ and 80% indicate interest in receiving advice from their financial institution.

“Bank customers’ appetites for financial advice is high and an increase in quality advice will only increase their customer satisfaction,” said Jennifer White, senior director for banking and payments intelligence at JD Power. “Therefore, providing personalized advice is mutually beneficial as customers who receive it are taking actions and benefitting financially, while banks are experiencing strong engagement and brand advocacy.”

Following are some key findings of the 2024 study:

• Advice recall high, especially among new immigrants and younger customers: More than half (52%) of all bank customers remember receiving financial advice from their bank. Specifically, immigrants who have lived in Canada for less than two years are more inclined to recall receiving financial advice from their bank (79%) than those who have lived in Canada longer (51%). Additionally, customers under the age of 40 also remember getting financial advice from their bank at a higher rate (61%) than do those in older age groups (47%).
• Most bank customers act on advice: More than three-fourths (77%) of customers who receive financial advice follow through and act on it. The most frequent actions taken in response to advice include shifting funds between accounts (29%); updating account settings (21%); downloading the mobile app (20%); and scheduling a meeting with a bank rep (20%).
• Satisfaction increases when customers take action: Overall satisfaction with retail banking advice increases 142 points (on a 1,000-point scale) when customers act based on specific advice from their bank.
• Banks still miss the mark on advice topics: The study finds gaps exist in nearly every category and topic when it comes to the advice delivered by the bank and the advice that customers are most interested in. The widest gap exists in the financial planning category, as the difference between those who are currently receiving that type of advice and those who want more is 16 percentage points, specifically, looking for more advice around tax reduction.

Study Ranking

RBC Royal Bank ranks highest in customer satisfaction for a fourth consecutive year, scoring 582 points. Scotiabank (568) ranks second and the segment average is 566.

The Canada Retail Banking Advice Satisfaction Study was redesigned this year. The 2024 study includes responses from 2,822 retail bank customers across Canada who received any advice/guidance from their primary bank regarding relevant products and services or other financial needs in the past 12 months. It measures customer satisfaction with retail bank advice/guidance based on performance in five core dimensions on a poor-to-perfect rating scale. Individual dimensions measured are (in order of importance): clarity; concern for needs; relevancy; quality; and frequency. The study was fielded from January through March 2024.

In addition to bank financial advice ratings, the study also provides financial health support index benchmarking data that evaluates proficiency of banks and credit card issuers in delivering financial support to customers doing such things as helping customers make better financial decisions or help customers meet savings, creditworthiness, or budgeting goals. The study also captures responses from customers about their satisfaction with the financial health support provided by their financial partners. Top-performing banks in the banking financial health support index are (in alphabetical order): BMO Bank of Montreal and RBC Royal Bank. Top-performing credit card providers in the credit card financial support index are (in alphabetical order): Desjardins, RBC Royal Bank and Scotiabank.

For more information about the Canada Retail Banking Advice Satisfaction Study, visit https://www.jdpower.com/business/financial-health-and-advice-satisfaction-study.

About JD Power
JD Power is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modelling capabilities to understand consumer behaviour, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 55 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business.

Media Relations Contacts
Gal Wilder, NATIONAL; 416-602-4092; [email protected]
Geno Effler, JD Power, West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

¹JD Power measures the financial health of any consumer as a metric combining their spending/savings ratio, creditworthiness, and safety net items like insurance coverage. Consumers are placed on a continuum from healthy to vulnerable.