Financial Services

U.S. Retail Banks Nail Transition to Digital during Pandemic

The nation’s retail banks have successfully navigated an historic transformation in which a record 41% of customers are now digital-only and although 24% of customers say they are worse off financially, overall customer satisfaction has increased. According to the J.D. Power 2021 U.S. Retail Banking Satisfaction Study,SM released earlier this week, retail bank efforts to increase customer communication, introduce customer relief and community support efforts and deliver strong digital banking services have helped them score high marks for customer satisfaction in a very challenging year.

If you’re looking for a case study in how to improve engagement and deliver a superior customer experience in the face of massive disruption, look no further than the U.S. retail banking industry’s response to the COVID-19 pandemic. The fact that satisfaction has improved most among customers who say they feel worse off financially speaks volumes to the proactive efforts many banks launched to support their customers in a period of heightened financial stress. Moreover, banks’ ability to deliver consistently through digital channels has helped reassure branch-centric holdouts and ease the large-scale transition to digital-only banking.

Following are some key findings of the 2021 study:

  • Customer satisfaction improves amid flight to digital: 
  • Banks step up efforts to help financially insecure customers: 
  • Majority of customers believe their bank supported them during pandemic
  • Big banks continue to close gap

The study measures customer satisfaction with banks in 15 geographic regions. Highest-ranking banks and scores, by region, are as follows:

California: U.S. Bank (818)
Florida: Chase (846)
Illinois: Chase (829)
Lower Midwest Region: BancFirst (871)
Mid-Atlantic Region: Atlantic Union Bank (854)
New England Region: Bangor Savings Bank (861)
North Central Region: Huntington (845)
Northwest Region: Umpqua Bank (830)
New York Tri-State Region: PNC (840)
Pennsylvania: Northwest Bank (834)
South Central Region: Chase (848)
Southeast Region: United Community Bank (884)
Southwest Region: FirstBank (823)
Texas: Frost (861)
Upper Midwest: Associated Bank (823) and Chase (823) in a tie

The U.S. Retail Banking Satisfaction Study, now in its 16th year, measures satisfaction in six factors (listed in alphabetical order): account opening; communication and advice; channel activities; convenience; problem resolution; and products and fees. Channel activities include seven subfactors (listed in alphabetical order): ATM; assisted online; branch; call center; IVR; mobile; and website.

Recommended Reading  

Business Insider: Big banks narrow customer satisfaction gap with smaller counterparts

Big banks were able to boost their customer satisfaction level by making progress in areas including products and fees; assisted online service; problem resolution; and communications and advice.

American Banker: Customer satisfaction with big banks increasing during pandemic: Report
Small and regional banks have historically outperformed their larger competitors in customer satisfaction, but their rankings have slipped during the pandemic.

The Financial Brand: Consumers Are Less Happy with Digital-Only Banks (Here’s Why)
The big shift to digital channel use by consumers during the pandemic should have been the shining moment for direct banks like Schwab, Discover and Ally. But all saw declines in their satisfaction levels, even USAA. Rock-bottom rates were a big factor, but not the only factor — nor the most significant one.