BrandsEye has released its 2019 South African Banking Sentiment Index, revealing which banks’ customers are threatening to bail – and where they would rather bank instead.
The 2019 South African Banking Sentiment Index analysed consumer social media posts about the five major retail banks from September 2018 to August 2019.
The group analysed over 1.9 million social media posts relating to South Africa’s five retail banks – namely Absa, Capitec, FNB, Nedbank and Standard Bank – as well as 68,500 posts relating to new entrants into the market, such as Bank Zero, Discovery Bank and TymeBank.
Posts were tracked across various platforms, including Twitter, Facebook and Instagram.
BrandsEye uses topic analyses to gauge the sentiment of posts (either positive or negative), across 73 topics, and seven broad categories, including reputation, customer service, pricing and customer retention.
Customers threatening to cancel accounts
According to BrandsEye, across the industry, around 7.7% of tracked conversations were around cancelling bank accounts.
FNB had the highest volume of cancellation conversation at 2.3 points above the industry average (10%).
The bank’s cancel volumes peaked in March due to consumers threatening to move their accounts after allegations of racism over home loans that were issued by Saambou and taken over by FNB in 2002. Nearly half of industry cancel conversation s(49.2%) impacted FNB.
After FNB, Absa and Standard Bank face the next highest risk of losing customers, BrandsEye said.
Standard Bank had the highest proportion of customers threatening to leave their bank while citing other banks. This suggests that Standard Bank clients may be at greater risk of churning, given that other options are being directly considered in cancellation threats, the group said.
“Consumers are sensitive to downtime and expect always-on access to their banking facilities. Standard Bank and Absa were the other banks that had higher-than-industry values for cancellation at 1.4 pp. Both of these banks received cancellation threats in response to system errors and technical errors with digital channels.”
Both Capitec and Nedbank were below the industry aggregated volume for cancellation. Capitec had the lowest in the industry at 2.8% of priority conversation.
Notably, the banks only responded to 68% of all conversations threatening to cancel accounts, with a response time of 25 hours.
What customers are unhappy about
Consumers demand speedy service from their banks. Delivering on the basics, rather than innovation, is a priority for consumers, BrandsEye said.
Turnaround time is the most cited issue by consumers who threatened to leave their banks. FNB had the highest share of cancellation conversation across all major themes.
“This is likely due to the bank’s relatively higher share of voice,” the group said.
“Despite having a low share of voice, Standard Bank contributed significantly to threats of cancellation due to turnaround time and brand comparisons.”
Capitec’s short turnaround time and low overall churn risk suggest that by delivering on the basics, the bank has managed to maintain the lowest churn rate.
Banking customers are also doing more research, BrandsEye said, with brand comparisons on products and services, as well as crowdsourcing data from other banking customers driving their decisions on where to bank.
Where customers would rather go
FNB and Capitec were most often cited as a preferred alternative when consumers threatened to leave their banks, BrandsEye said.
Absa, Standard Bank and Nedbank customers are all more likely to move to FNB, and then Capitec, the data showed.
Capitec customers who leave are also more likely to move to FNB, while FNB customers who leave are most likely to move to Capitec.
None of the other banks saw potential moves at rates matching these two groups.