Defying early expectations, customers actually became happier with their banks during Australia's first recession in 30 years
Customer satisfaction and Net Promoter Score (NPS) for the big four banks – ANZ, Commonwealth Bank, National Australia Bank and Westpac – soared during the COVID-19 pandemic, according to new research from Roy Morgan.
The NPS measures the willingness of customers to recommend a brand. Since the onset of the COVID-19 pandemic in Australia, there have been significant NPS hikes for all four big banks, with customers now far more likely to recommend their bank to others than they were a year ago, Roy Morgan found. That was particularly the case among customers with a mortgage.
Among mortgage customers, ANZ showed the largest year-on-year improvement, increasing their NPS by 29.7 points to a score of 15.4 in April, the highest of the big four banks. NAB increased its NPS among mortgage borrowers by 22.1 points to 9.6, landing just behind CBA, which posted a 10.4-point increase to 16.3 points. Westpac also posted an NPS hike, rising 5.7 points over the year to 6.9.
There are three banks in the top 10 (by market share) with higher scores, led by ING with 42.9, Bendigo Bank with 26.0 and Bank of Melbourne with 25.9. The best performers came in well above the current average bank NPS of 10.1, Roy Morgan said.
The data for the report was gathered from interviews conducted with more than 50,000 consumers each year.
Satisfaction up among big four
The big four banks all posted increases in customer satisfaction for their main financial institution (MFI) over the year to April, led by NAB, which saw customer satisfaction increase by 3.3% to 81.7%. ANZ posted a 2% rise to 78.6%. Commonwealth bank was up 0.1% to 80.9%, and Westpac was up by 0.1% to 76.2%.
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Other banks saw more mixed results. There were large customer satisfaction increases for Bank of Melbourne (up 9.6% to 90.2%) and St. George (up 4.4% to 86.1%), while Macquarie posted the largest drop, falling 3.3% to 88.6%.
However, the top three banks for customer satisfaction held their positions from a year ago, with Bank Australia in first place at 95.5%, ING in second at 94.2%, and Bendigo Bank in third at 91.4%.
Overall customer satisfaction with banks increased from 81.2% in April 2020 to 82.8% in April 2021, Roy Morgan said.
“The economic upheaval [of COVID-19] included throwing millions of Australians out of work and led to fears Australian’s banking system would be under huge stress as the newly unemployed would start to default on their loans in huge numbers,” said Michele Levine, CEO of Roy Morgan. “Thankfully, none of that happened. The hundreds of billions of dollars of support provided by the federal government – especially in the form of the $90 billion JobKeeper wage subsidy – kept those in precarious employment attached to their jobs and Australia’s banks responded to the crisis by allowing customers in financial distress to defer loans for at least six months, waiving charges on debt consolidation and loan restructuring. The response of the banks has been so effective that not only was the prospect of a devastating financial crash eliminated, but against the predictions of many, the perception of the banks improved during Australia’s first recession in nearly 30 years.”
Ryan Smith is currently an executive editor at Key Media, where he started as a journalist in 2013. He has since he worked his way up to managing editor and is now an executive editor. He edits content for several B2B publications across the U.S., Canada, Australia, and New Zealand. He also writes feature content for trade publications for the insurance and mortgage industries.LinkedIn | Email
