Majors’ lack of ‘belonging’ could incite switching

by Caroline Dann04 Oct 2012

Comparison site Mozo’s annual People’s Choice Awards revealed one in five borrowers plan to switch banks, with customers of the big four the most likely to jump ship.

The switching results come despite the majors clawing their way back to popularity.
CBA – the least popular major last year – is now ranked second behind NAB for customer satisfaction.
However, 20% of big four customers planned to switch, compared to just 10% of mutual and second-tier customers.
Mozo’s managing director, Rohan Gamble told Australian Broker Online the majors were turning customers off with a lack of trust and customer service.
“This year our home loan rankings are completely dominated by lenders with a brand that relates in some way to belonging, such as ME Bank, Newcastle Permanent, CUA, Greater Building Society and Heritage Bank,” he said.
“These lenders rate particularly highly on the measures of trust and customer service, and our analysis of this year’s home loan ratings shows that trust is the strongest indicator of overall satisfaction, over and above price or other more obvious criteria.”
He added that failure to pass on the RBA’s rate cuts was a serious mistake in terms of customer retention.
“The big banks do take a hit to their customer satisfaction ratings when they are perceived to be mean with their rates movements,” he said.
CBA was rated Australia’s worst home lender in last year’s Awards, after its super-sized rate rise on Melbourne Cup Day 2010.”
“More recently we have seen ANZ’s home loan ratings drop significantly in the first quarter of this year when they went out with their independent rates strategy.”