Just one in five Australians believes that a traditional retail bank will give them unbiased advice, putting their needs first, a global survey says.
The survey asked 55,000 people across 32 countries (with 2,000 from Australia) about their trust in financial institutions, and Aussie banks have come out wanting.
Australians were more likely to trust alternative financial service providers than traditional banks, with 44 per cent of non-bank customers saying they have complete trust in their provider, compared to 36 per cent of traditional banking customers.
Australians trust banks with their money, but not their advice. This matches global trends, where non-traditional banking options were deemed more trustworthy, like digital-only banks, fintechs and supermarkets offering banking services where fees were transparent, advice was unbiased, and product recommendations were clearly designed to fit the needs of consumers.
About thirty per cent of the Australian respondents said they are less reliant on traditional banks and financial institutions, and are happy about emerging alternatives.
Ratings and bank relevance indexing - we're winning
Australian retail banks scored 78.4 out of 100 on the inaugural EY Bank Relevance Index (BRI). The BRI evaluates how customers interact with banks both now, and expectations into the future. The global average was 75.1, with a developed market average of 76.6.
Other key findings
- Eighty-six per cent of the Australians surveyed still use a traditional bank as their primary financial service provider
- Thirty-two per cent said they have used a non-bank provider in the past year
- Twenty-one per cent have not yet used non-bank providers, but plan to do so in the near future
- Alternative providers are being considered within mobile payments (48 per cent), credit cards (42 per cent), and personal loans (41 per cent)
- About 37 per cent of the Australian customers believe there is product differentiation amongst providers
- Just 21 per cent feel extremely confident in the banking industry today
- Nearly half (47 per cent) prefer digital channels
- Thirty-one per cent are confident to manage their own finances
- Fifty-seven per cent value online research, but still want a branch or phone line to call for new products and advice