DataEQ has published its 2023 South African Banking Sentiment Index, revealing how consumers feel about the big retail banks in the country.
The index tries to determine how consumers view the big retail banks in the country by analyzing millions of social media posts over a year and categorising them by their general sentiment.
For the 2023 report, over 4.3 million social media mentions of the country’s banks were tracked from 1 September 2022 to 31 August 2023.
The report found that South Africa’s banking industry showed a significant improvement this year and had the best online consumer perception out of all the countries analysed (including the UK, Kenya, and the UAE).
Their net sentiments (derived from the balance of positive and negative social media mentions) grew from 9.4% in 2022 to 23.5% in 2023.
According to the report, this makes banking one of the “most loved” or best-perceived industries in the country.
However, what the report also found was that while these campaigns have been widely influential in boosting the image of these banks, they often “mask operational difficulties” that adversely affect customer perception, such as delays in payments and transfers and challenges in customer service and call centre responsiveness which “remain areas that require attention.”
Top spot is hotly contested
All of South Africa’s top banks increased their public perception over the past year.
FNB retained its top spot as the most favoured bank among South African customers, climbing its net sentiment results from 37.5% in 2022 to 41.9% in 2023.
On its heels was Discovery Bank at 40%, which increased its net sentiment by 32.1%, climbing from fourth position in 2022 to second.
This pushed last year’s second-most favoured bank, Absa, to third after it increased its net sentiment by 11.1% over the past year.
The worst perceived bank amongst customers is Capitec, which received a net sentiment rating of -0.1% despite increasing its rating by 15.3% over the past year.
“This shift underscores the dynamic nature of consumer perceptions and the competitive landscape in the South African banking industry,” said DataEQ.
Operational and reputational performance and campaign influence
DataEQ noted that all banks focused heavily on campaigns to boost the operational and reputational net sentiment scores. These campaigns paid off, with an estimate showing that the industry’s net sentiment would be 33% lower without them.
“Through engaging initiatives, such as online competitions, customer feedback surveys, and incentivised reshares, banks have successfully tapped into the competitive spirit of consumers and fostered a sense of community and direct engagement,” said DataEQ. “FNB, Absa, Standard Bank, and Discovery Bank were the brands that benefited most from this campaign boost to net sentiment.”
Additionally, FNB, Absa, and Discovery Bank stood out by receiving positive operational and reputational net sentiment scores.
Operational complaints lodged against banks were similar. These were overwhelming, relating to “poor customer service and digital experience that did not always meet their customers’ needs.”
Standard Bank recorded the lowest operational net sentiment, which was pinpointed on issues that included unresponsive support and delayed accident claim processes.
Absa maintained its top spot with the highest reputational net sentiment score, primarily attributed to widespread campaigns run by the bank.
Adversely, FNB faced the second-lowest reputational net sentiment despite its focus on campaigns. “Negative reactions were fueled by allegations of discrimination,” said DataEQ.
Treating customers fairly
Across the board, the “industry faced criticism for opaque and unfair practices, including allegations of unjustifiable interest rates, unauthorised transactions without adequate explanations, concealed fees,
unclear policies, and not doing enough to mitigate fraud-related incidents.”
This has resulted in an index that measures the response by customers if they have been “treated fairly.” These are marked as Treating Customer Fairly (TCF) discussions.
In 2023, there was an increase in positive TCF discussions, complemented by a decrease in negative ones.
Regarding TCF conversation ratios, FNB, Capitec, Discovery, and TymeBank performed better than the industry standards. On the other hand, Absa had the lowest TCF conversation ratio in 2022, and even though it improved by 9.9 percentage points from the previous year, it continued to have the lowest proportion in 2023.
In South Africa, “the industry’s more than doubling of Net Sentiment from the previous year… underscores the sector’s successful social media engagement strategies.
“However, this growth is a double-edged sword that could mask underlying operational challenges, particularly in customer service and digital experience. Customer expectations have evolved, emphasising the need for proactive communication from banks,” DataEQ said.