Sunday, April 21, 2024

Caliber’s Reputation Report Reveals Potential Bank Switching Among Consumers Amid Declining Public Support for the Financial Industry

Caliber, a leading stakeholder tracking provider, has released its 2023 Financial Services Reputation Report, offering a comprehensive global snapshot of public perception towards financial institutions. The report, based on a survey of over 10,000 consumers worldwide between January and May, highlights important trends and changes compared to the previous survey conducted in 2021.

Key findings from the 2023 report include:

High churn risk: Globally, approximately 23% of respondents express a likelihood of switching banks within the next 12 months. In the UK, where over 1,600 individuals were surveyed, this figure stands at 22%, representing an 11% decrease from 2021.

Reasons for switching: The desire to switch is primarily driven by perceived high bank charges, with 31% of respondents worldwide considering fees to be too high. Customers also express concerns that banks may not always act in their best interests.

Rise of new entrants: While overall engagement with financial services providers has declined in recent years, the fintech sector is viewed as more trustworthy than traditional banking, although the gap has narrowed since 2021. In the UK, the gap between the most reputable bank and the most reputable fintech company has decreased from 8 to 2 points.

Declining support for financial services: Public support for the financial sector has declined since 2021, with only a third of respondents worldwide advocating for, recommending, or considering working for financial services companies. The percentage of people willing to buy products and services from the largest banks globally has also decreased from 37% to 34%.

Trust and perception of fintech: Consumers increasingly trust emerging brands, including fintech companies, more than traditional banks. While traditional banks are more widely recognised, they have more negative associations compared to fintech. 15% of respondents view the banking industry negatively, compared to just 2% for fintech.

Importance of societal contribution: Consumers prioritise ethics, access to finance, and responsible investments when selecting a financial services provider. Negative associations with the industry stem from concerns about values, fees, complexity, and perceived lack of societal contribution.

Shahar Silbershatz, CEO and co-founder of Caliber, highlights the need for financial institutions to address these trends: “While traditional banks remain a safe harbor for customers in the current macroeconomic climate, they shouldn’t take that for granted. The data clearly shows that the fintech sector is quickly growing in popularity, and customers are increasingly willing to explore alternatives to traditional financial services.”

The report emphasises the importance for banks to adapt to changing customer preferences and prioritise customer-centric practices and social responsibility.

To access the full report findings, click here. The complete Global Top 101 brands list can be found here.

For more information about Caliber and its stakeholder tracking solutions, visit www.groupcaliber.com.

Elliot Preece
Elliot Preece
Elliot is the Editor at ABCMoney. He manages a team that writes and contributes to many leading publications across a number of industries.

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