UK banks: why they rank low in Customer Satisfaction?

Last month, the UK’s Institute for Customer Service produced its UK Customer Satisfaction Index (UKCSI) for the first six months of 2024. This is the most authoritative study of how well or not major organisations serve their customers. Overall, the latest report finds customer satisfaction is dipping across all sectors including banking and financial services.

So, it is striking that among the top 50 UK organisations for customer satisfaction there are none of the major UK banks except for Nationwide Building Society in 2nd place.

What can we draw from this?

One observation would be that unlike its competitors Nationwide is maintaining and investing in its branch network as an integral part of its customer service offer alongside mobile and online banking. Indeed, last March Nationwide choose Auriga to modernise the software infrastructure for its ATM customer service channel, to increase operational efficiencies while improving services for customers.

By severely slashing back their in-person and ATM channel, some other banks are undermining one of the principles of offering good customer service, namely letting a customer get the high quality service they need from the channel they choose whether that is in a branch, at an ATM, online or on their mobile. And, that service is consistently good and tailored to them regardless of which channel they choose rather than are forced to use.

Indeed, in the UKCSI, when consumers were asked what aspects of personal care and service they most valued, their availability when they needed them ranked top. When you dig into the study there is a further interesting finding that alludes to the importance of truly customer centric approach in banking.

The biggest gap between those banks with above average customer satisfaction scores and those with below average scores is the extent to which customers perceive that banks genuinely care about customers and build the experience around their customers’ needs.

Which actions can banking organisations take?

Actions maybe talk louder than words. As we have argued many times before, the challenges of maintaining in-person and physical banking channels can be overcome with modern self-service technology. Banks need solutions that facilitate the integration of digital and physical channels, in complete safety, limiting service interruptions and, consequently, negative consumer experiences.

There are some specific initiatives that banks can take to maintain and enhance customer experiences through its physical channels for accessing cash and financial services, even in remote communities.

More smart automation inside branches with modern digital self-service banking hubs reducing operating costs while extending services, can maintain and revitalise branch networks.

Data-driven cash management optimises the processes for moving money, containing the costs to guarantee the deposit and withdrawal service. Predictive analytics and machine learning can be used to more accurately anticipate cash demand at ATMs, considering different locations, and optimize the entire cash control, supply and movement process accordingly , for example by reducing the amount of unused cash at ATMs.

With AI, this approach can be boosted so that the supply and movement of cash can be done in real time, reducing unnecessary order management costs and the risk of service interruption.

It is more than just about how technology alone can reverse a fall in customer satisfaction. Look at an ATM pooling project like Batopin which Auriga supports in Belgium. This is seeing a root and branch resetting of the ATM infrastructure used by the country’s  major banks to be more customer centric by guaranteeing the accessibility of the service to end users thanks to greater geographical coverage.

The sustainability of the shared ATM infrastructure is enabled by how it uses our innovative WinWebServer (WWS) solution to modernise the management systems. The management model tested with Batopin can be replicated in different contexts and territorial areas, accelerating the transformation of ATMs into advanced branches, capable of enabling an offer of additional services in addition to the classic cash withdrawal. All for the benefit of an increasingly advanced customer experience.

The UKCSI is a barometer of how any organisation including banks is or is not making customer satisfaction a strategic goal. There is no mistaking the challenges involved but the pathways and tools for success are clear as some organisations are discovering.