LONDON – 17th March 2014 – The latest TNS Current Account Switching Index shows that despite growing awareness of the Switch guarantee, the rate of switching is not accelerating. Awareness of the Switch guarantee is highest amongst the over 45’s (63%). However, the higher rate of awareness amongst the over 45’s is not translating into action, with only 47% of Switchers coming from that age group. The ABC1 demographic also has high levels of awareness (60%) and unsurprisingly given this awareness, 58% of Switchers come from this group.
Switchers continue to be highly satisfied with both the switching process and with their chosen new bank (84%). Customer service is still the strongest reason for leaving their previous bank. Logistical considerations, access and branch opening hours are the strongest reasons for selecting their new bank.
Whilst Santander has continued to be the biggest gainer with 22% of Switchers now choosing them compared to 17% pre SWITCH, Nationwide is the biggest net gainer when comparing this period with the last reporting period. 11% of Switchers chose Nationwide and only 3% left, a net gain of 8% compared to 3% in the previous period. Those moving to Nationwide cite interest rates and reputation as reasons for choosing – a powerful combination, which reflects the growth of the Mutuals as a sector.
Conversely, Santander is chosen for its rates and rewards but is let down by its customer service. Almost 4 in 10 of those switching from Santander give poor customer service as the reason. The 12% of switchers leaving Santander is four times higher than the number leaving Nationwide.
Whilst there can be little doubt that consumers are appreciating the greater ease of switching, the fact that switching levels are constant suggests one of two things – either banks are giving customers less reason to switch (a clear win-win) or there is not a powerful enough proposition to cause real disruption.
Maureen Duffy, CEO of TNS UK said, “The research suggests that the Switch Guarantee alone is not enough to encourage customers to shop around. In other markets we have seen new entrants or re-invigorated players taking a more segmented approach and this is something we have not yet seen in Current Account banking.
“The continuing success of Nationwide may indeed convince more consumers that they need a bank account but not a bank and so they may be the fore-runner of more radical re-invention.”
Notes to Editors
Sample Size: 14,174 current account holders, TNS in-home face to face Omnibus, interviewed between 29 January and 21 February 2014. 516 Switchers were identified.
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