Financial institutions are struggling to keep the faith of Australians, with just over half (51%) trusting their banks enough to share financial information with them by linking their accounts, new data has revealed.
Open banking product Frollo conducted the research for its Open Banking – The consumer perspective report, looking at consumer attitudes towards sharing financial data by linking accounts.
Frollo surveyed 1,066 Australians of different sexes, ages, and locations about their financial data and the things they found important when sharing their information and who they trusted with it.
“I think for a long time it has been perceived that the banks lack accountability, with a willingness to change and are generally more focused on profit rather than the best interest of the customer,” said Nicholas Gleeson (pictured above), director of Brisbane brokerage Premier Asset Finance. “However, following the royal commission and the subsequent introduction of reforms to protect customers, along with an increase of investment to update systems and a renewed focus on improving education and compliance, I do feel as though they are heading in the right direction to repairing some of that lost trust.”
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The report found the level of trust consumers felt with brokers and financial advisers was sitting at 34%.
Gleeson said brokers could build the trust gap as their relationships with clients were fundamental to building trust for clients when interacting with the financial services sector.
“In my opinion, a good broker will not treat you as a once-off transaction but as a partner in an ongoing relationship based on trust, with the view to work for/with you to help you and your business grow into the future,” he said. “A broker should be viewed as a long-term partner who provides guidance and support when making important financial decisions, to be viewed in much the same way as they would view any other engaged professional services provider, be it an accountant, lawyer, or medical practitioner.”
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Gleeson said brokers offered a centralised repository of knowledge, skill set and relationship network that helped clients level the playing field in their interactions with banks and financial institutions.
“When a customer approaches a bank directly, they are only offered a small suite of products that may not suit the customers overall individual needs and objectives,” he said. “However, by utilising a broker, you will be provided with multiple options from a range of lenders to allow you to make an informed educated decision in your own best interest dependent on the specific requirements that you are seeking in a lending facility.”
Other insights from the report showed privacy was the most important aspect for survey respondents, with 91% considering it important, ahead of security and transparency at 88%.