A finder.com.au survey of 2,005 Australians has found that 57 per cent of the respondents would be “turned off” by poor customer service when choosing a lender, while 32 per cent would be “sceptical” about banking with a lender that does not have a local branch.
In an interview with The Adviser, the executive director of the Finance Brokers Association of Australia, Peter White, noted that he isn’t surprised by the new data.
“I think that’s why brokers are already capitalising on that marketplace and providing the services where the banks fall down, which is why we’re seeing 55 per cent or more of people getting their home loans through brokers.
“I guess it’s the difference between being an employee somewhere and being an industry professional that’s self-employed.”
The FBAA executive director continued: “You tend to learn the value of customer service and it’s important to do your business in a very sound way, so it’s different when you’re an employee, because when you wake up, you still get paid your salary.”
Money expert at Finder Bessie Hassan believes that banks need to do more to enhance the customer experience.
“The customer is still king, and it’s important that banks invest in the training and development of their people to unlock a positive customer experience,” Ms Hassan said.
Additionally, 32 per cent of the respondents said that, in making their decision, they would consider whether the bank has a local branch, and this, Mr White claimed, is the void that brokers have been filling for decades.
“In the mid 90s, 96 to 97, banks were closing branches left, right and centre, and it was the broking market that stepped up to the plate,” the executive director said.
“[Part] of the value proposition of brokers in Australia is the fact that they do deliver the services regardless if there’s a branch there or not, and obviously they’re building rapport in the community.”
Ms Hassan, however, was surprised that local branches are still in high demand, amid growth in online lending.
“It’s surprising to see that over a third of Australians would avoid a bank that doesn’t have a local branch.
“With a range of emerging online lenders, this goes to show that some people still prefer face-to-face banking.”
The research also found that 94 per cent of Australians don’t base their decision on the size of the lender, 30 per cent would be deterred by a negative story from a friend or college and 17 per cent would be deterred by the salaries of banking executives.
[Related: Broker market share reaches ‘record’ high}
Charbel Kadib is a journalist on the mortgages titles at Momentum Media.
Before joining the team in 2017, Charbel held roles with public relations agency Fifty Acres, and the Department of Communications and the Arts.
Charbel graduated from the University of Notre Dame Australia with a Bachelor of Arts (Politics & Journalism).
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