Only half of those surveyed by Consumer NZ say they trust their bank. Photo / File
Only half of those surveyed by Consumer NZ say they trust their bank. Photo / File
Only half of New Zealanders trust their bank and three-quarters think their bank is charging too much, research from Consumer New Zealand shows.
The consumer advocacy group's annual bank satisfaction survey also found almost all the big banks scored either below or close to average for customer satisfaction.
Consumer New Zealand chief executive Jon Duffy said trust appeared to be eroding in the banking sector compared to last year.
"Rising cost of living challenges, lower savings rates and other pressures may be contributing factors.
"Our Sentiment Tracker shows that cost of living is the most concerning issue facing New Zealanders. While the cost of living soars, banks are reporting major profits – which is not going unnoticed by customers. Approximately three out of four customers think the banks are charging too much."
New Zealand Bankers' Association chief executive Roger Beaumont said factors outside banks' control such as the rising cost of living and the ongoing economic impact of Covid-19 had negatively affected consumer sentiment generally, and that in turn impacted how people feel about banks.
"In 2020 we saw an increase in positive public attitudes to banks, and that's likely because banks deferred or reduced repayments on around $70 billion in loans."
"It's worth noting that around 90 per cent of transactional bank accounts attract no fees. And two-thirds of credit cards are paid off in full every month without incurring any interest costs."
He said it was also true that interest rates were rising which reflected the cost of funding for banks.
"...and that will impact perceptions of banking costs for borrowers."
Bank satisfaction
When it came to customer satisfaction The Co-operative Bank had the highest score at 86 per cent while TSB scored 78 per cent and also received the People's Choice endorsement.
But the biggest banks scored poorly. Westpac scored the lowest with 54 per cent.
It scored significantly below average for branch service and had the lowest rating for phone, branch and mobile banking.
Of those who had a problem with Westpac in the past 12 months, 69 per cent said complaints were handled poorly.
Ian Hankins, Westpac New Zealand general manager of consumer banking and wealth, said it heard what what customers were telling it in the survey and wanted to do better.
"We are immediately focused on making it easier for customers to get help with their banking when they need it, and quickly putting right any problems that are brought to our attention.
"We encourage any customer who is finding current conditions difficult to talk to us so we can help with some options."
Westpac had the lowest score in a customer satisfaction survey. Photo / File
ANZ's score was also below the market average, at 56 per cent. Customers of the largest bank were the least likely to be satisfied with fees and value for money but rated above average for mobile banking.
BNZ, Kiwibank and ASB all scored between 64 per cent and 60 per cent, with no figures above average for any of the key performance measures.
Kiwibank rated below average for responsible lending and its call centre service.
"Consumers are telling us that the bigger half of the banking industry is doing poorly on customer service," Duffy said.
"There have been added complications like the change to the Credit Contracts and Consumer Finance Act and the demise of some in-person branches forcing customers online. However, the big banks should note that consumers see a lot of room for improvement."
NZBA's Beaumont said banks were responsible lenders and took the need to comply with their regulatory obligations very seriously.
"We support the aims of consumer lending rules to protect vulnerable customers from costly and unsuitable loans. The recent CCCFA changes show how seriously banks take these rules, which have reduced access to credit for mainstream consumers, and this may also be affecting views on banks."
