Retail banks face customer dissatisfaction because of digital-only engagement shift

Tuesday 5 May 2020 14:09 CET | News

US-based data analytics and consumer intelligence company J.D Power has released a study showing how the COVID-19 pandemic affects retail banking customers’ satisfaction.

The most satisfied retail banking customers use both branch and digital services to conduct their personal banking, while the least satisfied are those who have a digital-only relationship with their bank and do not use branches.

52% of retail bank customers classified as branch dependent before the COVID-19 pandemic, and successfully transitioning them to digital—without compromising customer experience—will be critical in the weeks and months ahead.

Following are some key findings of the 2020 study:

  • Pre-pandemic, branches still played major role:  pPrior to the COVID-19 pandemic, 52% of retail bank customers were classified as branch dependent, meaning they either used the branch exclusively (10% of customers) or used a combination of branch visits, online and mobile banking service (42% of customers) during the past three months;
  • Digital-only customers have lowest levels of satisfaction: oOverall customer satisfaction with retail banks tends to decline as customers transition away from the branch and to digital-only banking relationships; 
  • Big banks lead midsize and regional banks on digital engagement: tThe bBig 62 banks currently have a jump on regional and midsize banks to build digital engagement. Prior to the pandemic, 49% of big bank customers had high levels of digital engagement, compared with 41% of regional bank customers and 36% of midsize bank customers; 
  • P2P payment integration emerges as wild card for bank customer satisfaction: sSatisfaction is significantly higher among customers who have linked their bank accounts to digital payment services (e.g., Zelle, Apple Pay, PayPal, Venmo) than among those who have not. 

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Keywords: retail banking, digital banking, JD Power, COVID19, pandemic, customer satisfaction, branch service, digital service, personal banking, customer experience, mobile banking, online banking, big banks, midsize banks, regional banks, big 62 banks, Zelle, Apple Pay, PayPal, Venmo
Categories: Banking & Fintech
Countries: World
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Banking & Fintech

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