Average customer satisfaction among Canada's largest banks fell by double digits
Customer satisfaction for Canada’s five largest banks has significantly decreased as Canadians continue to bear the brunt of the high interest rates and inflation, according to a new study by J.D. Power.
The data analytics, software, and consumer intelligence company released its 2023 Retail Banking Satisfaction Study, which showed that the average customer satisfaction for the five largest banks in Canada fell by 10 points from the previous year. Meanwhile, mid-sized banks saw a drop in customer satisfaction by seven points.
“Customers are under increasing economic stress and express a declining feeling that banks are addressing their concerns and financial challenges,” said Paul McAdam, senior director of banking and payments intelligence at J.D. Power.
Increasing dissatisfaction among struggling Canadians
The report showed that the Bank of Montreal had the highest customer satisfaction score out of the five largest banks with 612 out of 1,000, being the only bank that saw an increase. In the previous year, it was ranked third with a score of 610.
It was followed by the Royal Bank of Canada which saw the largest drop in customer satisfaction with a -19 decrease from its 629 score in the previous year, breaking its three-year streak as the highest-ranking bank. The Canadian Imperial Bank of Commerce was third with a score of 604 (615 in 2022) followed by the Bank of Nova Scotia with 597 (599 in 2022) and the Toronto Dominion Bank with 594 (606 in 2022).
The decline came as the survey found that there was a 44% increase in Canada’s banking customers reporting that they were financially vulnerable or stressed. J.D. Power said that what contributed to this overall decline was the feeling that their bank’s account offerings were not meeting their needs.
The study also found that nearly 80% of customers said that banks could do better in communicating with them about how they may avoid fees as more have reported that they were paying more in the last year. There was also a decline in satisfaction with branch service, online, and mobile banking along with a decrease in satisfaction regarding how banks handled fraud-related problems.
McAdam said that customers wanted banks to tell them how to avoid fees, build savings and reduce debt, and resolve problems efficiently. He further noted that banks that had higher ranks were those that efficiently provided such services.
For mid-sized banks, Tangerine Bank had the highest score (684) which was followed by Simplii Financial (650), ATB Financial (638), Desjardins (619), National Bank of Canada (617), and HSBC Bank of Canada (602), with the latter three scoring below the segment average.
The customer satisfaction scores were based on seven factors: trust, customer service, account offerings, allowing customers to bank how and when they want, saving time and money, digital offerings, and problem and complaint resolution.
The report was based on the responses of 13,960 retail banking customers of large and mid-sized retail lenders in Canada, which was conducted between January and February 2023 as well as between July and August 2023.
