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High street banks remain poor for customer satisfaction

Big bank dominance is sign of a failing market

Bank sign customer satisfaction

First Direct top the pile while Santander continue to struggle 

The UK’s largest high street banks are among the worst for customer satisfaction, according to a new report by Which?

Which? members rated 28 banks and building societies for customer satisfaction across current accounts, mortgages, savings accounts and credit cards, with none of the biggest high street banks featuring in the top 15.

Santander was rated bottom, with an overall customer score of just 41% while taxpayer-backed banks Lloyds TSB, Halifax, Bank of Scotland, RBS, Natwest and Northern Rock were all rated poorly. First Direct, the online bank, came top for customer score with an overall rating of 84%.

Continuing lack of transparency

Which? says that banks’ ability to keep their customers happy isn’t reflected by their share of the market. The four banks with the highest customer scores for current accounts control just 6% of the current account market, while the four with the lowest scores control 38%.

Which? agrees with the Independent Commission on Banking’s (ICB) aim of improving competition in the industry but believes more needs to be done. The lack of transparency and complexity of different charging structures make it difficult for consumers to understand how much they are paying for their account and whether another bank offers a better deal.

Big banks have poor record on customer satisfaction

Which? chief executive, Peter Vicary–Smith, says: ‘The Independent Commission on Banking has acknowledged that the market isn’t competitive and consumers are infuriated by poor service. The Government must be clear how it will create more competition when it sells our stakes in Lloyds, RBS and Northern Rock. The industry must be referred to the Competition Commission if the market doesn’t improve.

‘The high street is dominated by banks that have a shocking record for customer satisfaction – what more proof do we need that the market isn’t working? We will only have a truly competitive market when banks are made to face up to a simple choice – either look after your customers or be prepared to lose them.’

More on this…

  • Check out the full customer satisfaction scores for savings and current account providers
  • See how the big mortgage lenders stack up
  • Credit card companies rated
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