The customer satisfaction gap between South Africa’s banks is closing rapidly, with the digital acceleration brought about by the pandemic being a significant equaliser.
Banks are under significant pressure to reinvent their customer value propositions and differentiators at a time when technology and digitisation are making them increasingly invisible to their customers – until things go wrong.
These are just some of the findings of the 2021 South African Customer Satisfaction Index (SAcsi) for Banking conducted by Consulta, providing highly scientific insights into the overall level of satisfaction of customers of South Africa’s top retail banks.
Consulta polled just on 12,000 customers from the lower, middle, and upper retail banking segments on their overall satisfaction with five of South Africa’s participating retail banks during 2021 – Absa, African Bank, FNB, Nedbank and Standard Bank.
The SAcsi for banking utilises a causal model that links customer expectations, perceived quality and perceived value to customer satisfaction (the SAcsi score), which is linked to customer complaints (and recovery) and customer loyalty intentions as outcomes.
“Banks and their customers have adapted to digital banking platforms in unprecedented circumstances and time frames. Every aspect of the customer journey has been fundamentally upended, with customers now engaging with many self-service channels from Artificial Intelligence (AI), chatbots, apps, and contact centres opening up between banks and their customers.
“These developments have significant consequences for customer experience, expectations, and satisfaction, and how customer complaints are handled and resolved in an environment where customers no longer make a distinction between their online and offline experiences,” said Abigail Boikhutso, CEO of Consulta.
Banks now need to maintain a complex hybrid structure of online and offline service platforms for diverse customer preferences – from contact centres to banking apps, to webchats, to in-branch visits right through to social media, she said.
“Banks are under pressure to ensure that every banking functionality is value-adding, seamless, simple, and provides the real-time assistance and first-time resolution for every customer enquiry, no matter the service channel.”
Consulta pointed out that South Africa’s banking sector is world-class in terms of customer satisfaction. Customer Expectations remain high at 83,8 in 2021, rising every consecutive year since 2017 when the par was 80.2. It said that the banking sector remains the top performer when it comes to customer satisfaction.
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Overall Customer Satisfaction Score
African Bank (87.5), Nedbank (81.9) and Standard Bank (81.1) – are all in leader positions and above the industry par (79.7). All three leader banks also show improvements in overall Satisfaction scores compared with 2020, the market research firm said.
African Bank improved from 83.4 in 2020, Nedbank improved from 81.1 in 2020, while Standard Bank improved from 77.7 in 2021. All three banks show consistent and marked improvements in customer satisfaction scores over the last three indexes.
FNB (79.8) is on par, while Absa (77.0) is below par – both show marginal declines on their 2020 scores.
Nedbank continues to make consistent year-on-year improvements and has for the third consecutive year outperformed FNB, achieving more than a 2-index point lead on FNB in 2021. Nedbank has shown consistent improvement in getting its positioning, pricing, messaging, customer-facing, and online channels right, said Consulta.
Both African Bank and Standard Bank have made marked improvements in overall customer satisfaction scores.
Customer Expectations and Perceived Quality
Customer expectations within the banking industry continue to rise to new highs of 83.8 (compared with 83.1 in 2020 and 82.4 in 2019). Customer expectations have risen consistently for 5 years, up from 80.2 in 2017, the firm pointed out.
All banks perform above par (83.8) on customer expectations, barring Absa (82.3) which is below par.
In terms of perceived quality, African Bank (90.3), Nedbank (85.1) and Standard Bank (84.5) are above par (83.7). FNB (83.8) is on par, while Absa (82.1) is below par.
Nedbank has consistently been on an upward trajectory on Perceived Quality for five years and performed above the industry par each year, said Consulta.
In terms of the gap between customer expectations and perceived quality in 2021, FNB has the largest negative gap (-0.7) with perceived quality falling short of customer expectations.
African Bank has the largest positive gap (3.5), which means that perceived quality exceeds customer expectations.
Complaints Incidence and Resolution
African Bank has the lowest complaint incidence (9.9%) and a very high Complaint Resolution (77.3) – more than 20-index points ahead of industry par. This means that African Bank customers have the least number of complaints, and the bank has a high success rate in resolving complaints to their customer’s satisfaction, said Consulta.
Standard Bank (23.4%) and Nedbank (22.6%) have high complaint Incidence rates, however, they also have high complaint resolution rates at 59.5 and 56.8 respectively. FNB (23.3%) has a high complaint incidence rate, and its Complaint Resolution rate is also below par at 52.2.
Absa’s complaint incidence rate (19.0) is slightly better than industry par, however, its complaint resolution rate is also below par at 53.3.
Customer complaints mostly revolved around account queries, debit orders and payments, card issues, fees, and costs, said Consulta. Banks continue to be poor at preventing repeat causes of complaints and customer dissatisfaction once resolved, which directly correlates with customer loyalty.