We all know that one of the biggest fall outs from the global financial crisis was the severe knock to consumer trust. However, while Europe’s bankers continue to deliberate on how to rebuild this trust, emerging market banks have arguably benefitted, writes Dean Young
For example, the post crisis consumer in emerging markets has put more trust in local providers; this is evident in new research* we published last week regarding consumer attitudes and expectations of banks. The findings showed that more than 75% of consumers in the Middle East and Asia do trust their banks.
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So are consumers learning to love their banks again?
In short, the answer is no. In fact, despite encouraging trust levels, it is clear that consumers wished their banks knew them better. Of the 1,000 consumers we surveyed, less than half felt their bank understood their needs well. So, while they are more trusting, they are also less loyal and are not putting all their eggs in one banking basket.
Today’s consumer is spreading the love, and 40% of respondents in these markets confirmed having relationships with three or more financial service providers.
There are some very clear opportunities for banks to win back the affections of consumers in these markets and drive increased profitability from existing consumers:
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By GlobalData1. Help educate and advise on personal finance matters – 37% of respondents claimed to have little or no financial knowledge, presenting an opportunity for banks to educate and advise their customers better.
2. Join the multi-channel dots – consumers are dissatisfied with both digital and non-digital channels and want an improved and consistent multi-channel experience. The branch, online and mobile banking were the top three channels where consumers want to see improvement. 47% of respondents are currently not using mobile banking and could be targets for this increasingly popular banking feature.
3. Get to know them better – Nearly 60% of respondents confirmed they were willing to offer more personal information if it meant their bank would get to know them better. Consumers classify convenience, product range and service personalization as the key reasons why they look beyond their primary bank for their personal finance needs.
The less loyal consumer has made competition rife in emerging markets. New market entrants with nimble customer acquisition strategies are aggressively pursuing this opportunity. Banks in these markets must focus on winning back their customers by capitalizing on the trust and the will of these consumers to give more to their banks in exchange for more in return.
*SunGard’s Bank Readiness research was undertaken in Q3 2013. The study is based on a survey of 1,000 consumers undertaken by Loudhouse Consultancy. The survey covers the following 10 countries:
– Southeast Asia: Indonesia, Malaysia, Philippines, Thailand
– Middle East: Kuwait, Qatar, Saudi Arabia, United Arab Emirates, Jordan, Bahrain
Dean Young is vice president of product management at SunGard’s retail banking business
