BUSINESS

Canada’s Big Banks Lose Again In Customer Satisfaction Survey

Tangerine is Canadians' favourite bank for the sixth year in a row, J.D. Power finds.

07/14/2017 13:46 EDT | Updated 07/14/2017 14:58 EDT

When it comes to retail banking, bigger isn't necessarily better.

That's the judgment of 13,000 Canadian banking customers in a survey carried out by marketing information services firm J.D. Power.

For the sixth year in a row, Tangerine Bank took first place on customer satisfaction, scoring 820 out of 1,000 points.

J.D. Power

The mostly-online bank launched in Canada in 1997 as ING Direct, but was eventually bought by Scotiabank and rebranded as Tangerine.

Scotiabank itself scored 747 points, the second-lowest of any of the banks surveyed and the lowest among the Big Five.

In all, four mid-sized banks Tangerine, PC Financial, ATB Financial and National Bank scored better than any of the Big Five, among whom RBC scored the highest.

J.D. Power

J.D. Power noted that Canada's big banks have made notable progress in mobile banking and mobile banking satisfaction, but wondered whether that success came at the price of worsening performance elsewhere.

It noted that the Big Five improved their performance in this year's survey in only two of seven categories.

"Canadian retail banks have been pioneers in their embrace of the mobile channel and their development of mobile apps that really resonate with customers, but success in retail banking today requires a multi-channel approach," J.D. Power consultant Bob Neuhaus said in a statement.

"The majority of retail bank customers are what we call channel omnivores, meaning they frequent several different touch points with their banks. Banks need to maintain focus on the traditional foundations of the banking experience...."

Little things can make a difference


"Overall satisfaction scores are 83 points higher among customers who were greeted at the branch entrance and 63 points higher among those whose teller addressed them by name," J.D. Power said.

And financial institutions should be careful about hiking their fees.

"Banks can harm the level of trust that is established with their customers when they make changes to agreed-upon terms of financial accounts and products," the survey noted.

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Best Credit Cards In Canada, 2016

A new fee drops customer satisfaction by some 50 points, while an increase in existing fees drops satisfaction by about 45 points, the survey found. An increase to interest rates causes satisfaction to drop by 31 points.

That likely means Canadians are about to become slightly less satisfied with their banking services.

All of Canada's big banks raised their prime lending rates this week, after the Bank of Canada hiked its key interest rate to 0.75 per cent from 0.5 per cent, the first interest rate hike at the central bank in nearly seven years.

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