South Africa’s biggest banks earned a lot of good will and loyalty with customers during the Covid-19 lockdown, in large part due to their wide-scale debt relief responses.
This was the headline finding from the latest South African Consumer Satisfaction Index (Sacsi) for banking in 2020, by Consulta, which gauged customer sentiment and happiness at Absa, FNB, Capitec, Nedbank, Standard Bank and African Bank.
The group polled almost 12,500 customers from the lower, middle, and upper retail banking segments for the survey.
The index found that with the Covid-19 pandemic in tow, banks had to adjust their business models even more rapidly, with many services being upended. The move towards a tech-driven digital-first approach was already in motion before the pandemic, Sacsi said, but was accelerated at unprecedented levels.
“Every aspect of customer service and engagement has been radically changed by technology, digitisation, and remote working models. Banks and their customers adapted to new technology platforms and unprecedented circumstances,” it said.
Banks also needed to ensure that their commercial interests, business operations and customer service channels continued unencumbered by the pandemic.
“The arrival of the pandemic and hard lockdown redirected banks and their customers to an increased reliance on digital tools, processes, and self-service channels as a replacement for in-branch and call centre interactions, Sacsi said.
“The digital acceleration brought about by the adaptation to a new multi-channel, connected normal, combined with consumer financial distress, have further increased customer expectations off an already high base, while reducing their tolerance for a bad customer experience.”
Some banks fared better than others in adapting to this new environment, but all banks – bar one – managed to increase their levels of customer satisfaction over the last year.
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Capitec regained its position as the country’s bank with the happiest customers, followed by African Bank, Nedbank, and FNB – all in leader positions and above the industry average.
Absa and Standard Bank, although showing improvement on previous 2019 scores, come in below industry par.
“While Capitec maintains its leader position, it is showing signs of fatigue, with African Bank and Nedbank closing the gap. One of the challenges for all banks is to outpace rising customer expectations which show a year-on-year increase, markedly so after the arrival of the Covid-19 pandemic,” Sacsi said.
Nedbank continued to make consistent year-on-year improvements and has for the second consecutive year outperformed FNB.
“Nedbank’s robust and consistent improvement, which has focused on getting its positioning, pricing, messaging, customer-facing, and online channels right, is paying dividends,” Sacsi said.
“This is further demonstrated in a recent Banking Market Share study conducted by Consulta in 2020, which shows that despite the turbulent year, Nedbank has maintained its market share, while all other banks declined in market share, except for Capitec, which grew by 4%.”
Although showing some improvement in the last two indexes, Absa and Standard Bank are still struggling with their value proposition to clients, it said.
African Bank, which was the only bank to see a decline in the Sacsi score, still performed well.
“While it has a significantly smaller customer base, it is notable that it performs well within its niche. It would do well to balance any product diversification against the customer service and satisfaction trade-offs that come with a broader focus and a more significant customer base,” Sacsi said.