OMAHA, Neb.–Size matters when it comes to people referring someone else to a financial institution–but not in the way many might assume.
According to a new survey of 2,000 Americans, 74% are likely to recommend their financial institution to someone they know well, with the most common reason given for recommending their financial institution being good customer/member service (82%).
But the survey, conducted by The Harris Poll on behalf of D3 Banking Technology, found that nearly three-in-five Americans (58%) say if they had to choose, they would prefer to bank with a local/regional financial institution instead of a national one. Better customer service (59%) was the top reason for this preference, D3 Banking Technology reported. However, of those that would prefer to bank with a national institution over local/regional, 42% said it’s because they offer a better digital banking experience.
“It’s encouraging that the majority of consumers would largely recommend their banks or credit unions and prefer regional and community institutions over the biggest banks,” said Mark Vipond, CEO of D3. “However, the fact that so many consumers prefer the largest institutions because of their superior digital offerings should be a wakeup call. It’s imperative for regional and community institutions to enhance their digital experience and offer a more intuitive and comprehensive interaction than they have currently. It’s no longer good enough for institutions to simply get by with a mediocre app or website – they must make these channels their differentiator.”
The Effect of Digital
The survey found institutions must have more than a digital experience that is seamless and user friendly. More than three-in-five Americans (61%) want their financial institution to anticipate their financial needs the same way as online retailers do. To anticipate the needs of customers and members, financial institutions must determine how to effectively leverage their data. More than three-fourths of Americans (78%) feel more comfortable with their financial institution having access to their personal data than a large tech organization.
“This trust could open the door for making anticipating needs possible,” said D3 Banking Technology in its analysis.
Added Vipond, “These survey results demonstrate that it’s the regional and community institutions’ game to lose. Consumers want to bank with these institutions and trust them with the sensitive information that is needed to anticipate customer or member needs and personalize the services required to meet those needs. Savvy banks and credit unions are partnering with strong digital banking providers that provide a full set of digital banking services out of the box including integrated, intelligent data analytics that allow institutions to better serve the consumers.”