Novelist Patrick Rothfuss once wrote, “Time and tide make us mercenaries all,” words that accurately describe the relationship between banks and their customers in the time of a 40-year-high inflation rate.
Banking and Payments Intelligence Report, May 2022
As Americans find that their paychecks don’t quite put as large of a dent in their bills and their retirement accounts are struggling to keep pace, they are actively starting to look for ways to make their money stretch further, casting aside their long-standing loyalties along the way.
When it comes to retail banking customers, that trend is manifesting itself in a hunt for bigger incentives at new institutions, a development that—even in a time of waning brand loyalty—has gathered momentum quickly during the past several months.
Money on the Move
The trend is clear: Americans are tightening their belts, and they’re willing to reset that “Customer Since” line on their monthly statements to do it. In fact, we’ve found that 26% of customers moved money to another institution in the past 30 days and, on average, they moved about one-third of their deposits.
Banking customers under age 40 are more likely to have shifted money in the past 30 days, as well as customers who are in more vulnerable states of financial health—but the trend is not exclusive to these segments. Customers in healthy financial situations are on the move as well, which creates a huge opportunity for banks to get aggressive about customer acquisition.