Banks not meeting customer expectations: SunGard research
By Digital News Asia November 21, 2013
- Survey of 1,000+ consumers in 10 countries across South-East Asia and Middle East
- Customers moving towards multiple banking relationships to meet their needs
NEW consumer research undertaken by SunGard has found that banks in some of the world’s fastest-growing emerging markets are still struggling to meet evolving customer expectations.
This is negatively impacting the customer experience and driving a trend towards multiple banking relationships, which could affect future profitability and agile growth, the software and technology services company said in a statement.
The ‘Bank Readiness Index’ survey about current attitudes and expectations of the consumer banking relationship covered more than 1,000 consumers in 10 countries across South-East Asia and the Middle East, undertaken by Loudhouse Research in the third quarter of this year.
South-East Asian countries that were covered were Indonesia, Malaysia, the Philippines and Thailand. Middle East countries were Kuwait, Qatar, Saudi Arabia, United Arab Emirates, Jordan and Bahrain.
“Despite the fact that banks in emerging markets enjoy a high level of consumer trust, this research illustrates that they are not capitalising on this,” said Dean Young, vice president of product management for SunGard’s retail banking business.
“Consequently, more consumers are pursuing multiple banking relationships which can result in erosion of primary bank profitability and growth. Banks must invest in enhancing their multi-channel propositions to empower staff to serve customers more effectively and drive greater revenue from existing relationships and prospective customers,” he added.
Key findings of the research:
Trust does not guarantee loyalty
While over 75% of respondents in the Middle East and South-East Asia trust their bank, less than half of respondents felt their bank understands their needs well. This is evident in the increasing trend towards multiple banking relationships, driven partly by growing demand for service personalization, said SunGard.
Banks are not seen as the primary financial adviser. Consumers in South-East Asia and the Middle East are almost twice as likely to turn to family for help in personal financial decision making – 37% of respondents claim to have little or no financial knowledge and only 17% of respondents in Malaysia said they are well-informed about financial products and services.
This presents banks with an opportunity to educate and advise their customers more to deliver an improved client service and drive agile growth for their business.
Technology is rapidly evolving, driving continuous change in the way that customers interact with their financial service providers. Customers are demanding an improved, integrated multichannel experience, SunGard said.
Dissatisfaction with digital channels is high. When asked to name one or more areas they would like to see their banks improve, 55% highlighted online banking and 45% mobile banking services.
This is another area of opportunity for banks, as 47% of respondents are currently not using mobile banking and could be targets for this increasingly popular banking feature. One in two respondents expects the bank to deliver a better mobile experience in the future.
For many new banking relationships, convenience is of utmost importance. But along with convenience, banks in Asia must also ensure consistency across all channels.
According to the report, more than a third of respondents in South-East Asia and the Middle East are currently dissatisfied with the consistency of service they receive across their bank’s different channels.
This provides a challenge to organisations to improve and standardise the customer experience across all platforms, both digital and traditional.
The quest for convenience, product range and personalised service are driving multiple banking relationships, SunGard said.
Convenience is the biggest driver of multi-bank relationships, with 65% of consumers citing this as the top factor for having more than one financial service provider; while 40% of consumers have relationships with three or more financial service providers.
Product range was the second highest factor driving multi-bank relationships, ranked by 44%. A view of the financial products used reveals significant opportunity for cross- and up-selling by banks.
For example, customers tend to use their primary bank for account and card products and services, but far less for insurance or loans.
Nearly 60% of respondents are willing to offer more personal information to receive customised products and services, while 25% regard service personalisation as a driver to hold more than one banking relationship.
With annual revenue of over US$4 billion, SunGard is one of the largest privately-held IT software and services companies, serving approximately 25,000 customers in more than 70 countries and with approximately 17,000 employees.
Its solutions for retail banking cover core banking, multichannel customer management, including tablet, mobile and online banking and card management.
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