Stakeholder tracking provider, Caliber, has released its highly anticipated 2023 Financial Services Reputation Report, offering a comprehensive global overview of how financial institutions are currently perceived. The report, based on surveys conducted between January and May with over 10,000 consumer respondents worldwide, presents a comparison of data from Caliber’s previous survey in 2021.
Key highlights from the 2023 report include:
High churn risk, particularly in the U.S.: Approximately 23% of individuals globally express a likelihood of switching banks within the next year. In the UK, where over 1,600 respondents were surveyed, this figure stands at 22%, representing an 11% decrease from 2021.
Fees and social responsibility driving desire to switch: Around 31% of respondents worldwide believe that bank charges are unreasonably high. The risk of customer churn primarily stems from these elevated fees and a perception that banks do not consistently act in the best interests of their customers.
Growing reputation of new entrants: While overall engagement with financial services providers has declined compared to two years ago, the fintech sector is still viewed as more trustworthy than traditional banks. However, the gap between the two has narrowed since 2021. In the UK, the gap reduced from 8 points to just 2 points between the most reputable bank and the most reputable fintech company.
Declining customer support and trust in the financial services sector: Caliber’s report highlights a decline in public support for the industry since 2021. Only one-third of respondents worldwide are likely to advocate for or recommend financial services companies, representing a slight decrease from the previous survey. Additionally, the willingness to buy products and services from the largest banks decreased from 37% in 2021 to 34% in 2023. Recognition of the largest banking brands globally also decreased from 67% in 2021 to 55% in 2023.
Trust and Like Score, a proprietary measurement system developed by Caliber, indicates the strength of a company’s brand and reputation. Scores above 80 are considered “Very High.”
Shahar Silbershatz, CEO and co-founder of Caliber, expressed concern over these figures and urged traditional banks to take note of the growing popularity of the fintech sector. Silbershatz emphasised that while traditional banks currently serve as safe havens for customers in the prevailing macroeconomic climate, they should not take customer loyalty for granted.
The report further highlights consumers’ increasing trust in emerging brands, particularly in the fintech sector. While traditional banking institutions enjoy wider recognition, they also face more negative perceptions compared to fintech. 15% of respondents associated negative attributes with the banking industry, whereas only 2% did the same for fintech.
Caliber’s data also reveals that Millennials and Gen Z are more likely to embrace fintech products and services, emphasising the importance for traditional banks to adapt to retain younger customers.
Lastly, the report emphasises that consumers prioritise ethical practices, access to finance, and responsible investments when selecting financial services providers. Negative associations stem from concerns about the industry’s values, fees, complexity, and perceived lack of societal contribution.
Silbershatz concludes that financial institutions must prioritise customer-centric practices and social responsibility to address the risk of customer churn.
For the full report findings, visit here For the Global Top 101 brands list, visit here
About the Report:
The 2023 Financial Services Reputation Report is based on insights gathered from surveys conducted in 2021 and 2023. Caliber surveyed 10,151 people across seven markets (Brazil, China, France, Germany, Japan, the UK, and the US) and over 4,000 people in Canada and other European markets. The report includes 16,301 ratings of 101 companies across 14 markets. The selected companies are market leaders in the financial services sector within their respective geographies, making them representative of the industry. The respondents were randomly selected in each country, with the sample being representative of the national population in terms of gender, region, and age (18 to 75 years old).
About Caliber:
Caliber is a global data provider for stakeholder tracking, empowering companies to gain real-time insights into how they are perceived by stakeholders worldwide. The company helps global brands build trust with their employees, customers, investors, opinion leaders, talent, and other stakeholders by harnessing the power of reputation data. To learn more, visit www.groupcaliber.com.
The post Caliber’s Reputation Report Reveals Potential Shifts in Consumer Loyalty Among Financial Services first appeared on BusinessMole.
