The Harris Interactive Financial Services team has been tracking confidence in the financial sector regularly since May 2010. A decade on and it appears that the sector has recovered from the 2008 crash, with consumer confidence levels in areas covered across the whole period doubling. The only exception is the Bank of England which had the highest starting point.
High street banks in particular should be pleased with recent progress, a steep upward trend taking it from similar levels to other sub-sectors to above the FCA and back to second place behind the Bank of England. This is an impressive recovery in the face of recent years’ high-profile issues such as mis-selling, over-charging, bonuses/pay rises, IT failures, branch closures and low interest rates.
In the most recent results, conducted in the days leading up to the General Election, the sector seems to have maintained, and indeed even improved, confidence levels at a time of uncertainty for the British public around Brexit.
When asked what confidence means, trust is at the forefront of consumers’ minds.
Honesty and doing things in the interests of customers also come through strongly but, even then, trust is key – for example:
‘Can I trust them to act ethically, transparently and in my best interests?’
‘The confidence in the actual company doing the right thing by its customers, being honest and open about their business and to be trustworthy’
‘That they act in an ethical manner in everything from their own business practices in dealing with their customers to where they invest their own funds. There are still trust issues in financial services going back to the crash in 2008. I do a lot more research into companies I either invest in or when looking at financial products’
‘Confidence means being sure that a financial institution will look after your money for you & will provide you with services in a fair manner’
‘Assurance that they have my best interests in mind, being able to trust them’
‘To be able to trust with money, with the advice and services they offer. To know it’s strong and doing well so no crashing in the financial market. Most of all to know my money is safe’
Despite its positive trajectory, consumer confidence levels for all sub-sectors remains below 50%.
The sector is performing relatively well on some important elements: guaranteed secure personal information, security measures in accessing accounts, customer service. These are all areas where the sector needs to remain focused.
Consumers also believe the sector is largely providing clear communications and quality products.
Following investment in digital and mobile, the sector performs strongest on choice of ways to interact, although this is deemed less important by consumers.
In an era of low returns, it is not surprising to see return on investment as a desired improvement area. Two other areas emerge as key priorities:
Despite efforts by the sector around transparency of commission and fees, insurance renewals and overdrafts, the sector underperforms in relative terms on the most important attribute: transparency on returns and fees.
The sector performs least well of any attribute tested on rewarding loyalty. How the sector addresses the CMA’s super complaint on the loyalty penalty in the savings, home insurance and mortgage markets will be key.