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Many consumers stay with their banks for years unless persuaded by other bank incentives

Nearly half of consumers would switch banks if another bank offered better offers. (iStock)

While consumers tend to stick with their banks, some are reluctant to turn down the incentives offered by online-only banks. Vericast Survey They said they’ve been with the same bank for longer than their current relationships.

Customers appear to stick with their banks more for convenience than anything else: Some 46% of those surveyed said they would be willing to switch to another financial institution if it could address their specific financial needs.

When searching for a new bank, customers are primarily interested in money-making incentives. The two main motivators customers cited for switching banks were better interest rates and earning cash back on opening a new account. Consumers also value checking account offers.

“Consumers want to feel loved directly by their financial institutions. [financial institution]”With consumer behavior and mindsets constantly changing, financial institutions must be more mindful of their customer relationships than ever before. From understanding customers’ financial goals to providing offers that support their needs, financial institutions must focus on authentic, personalized connections with their customers to provide new and improved value to them,” said Lisa Nicholas, senior vice president, financial institution marketing products and strategy, Vericast.

ATM location also played an important role in customer satisfaction with a bank, with nearly one in three survey respondents saying that convenient ATM locations and a wide network were important when considering a bank.

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Consumers are spending more than $1 trillion in interest payments, primarily due to rising credit card debt.

Customer satisfaction with online-only banks is declining

Online-only banks are a source of revenue for many customers. Low fees and sign-up perks make them an attractive option. But customer satisfaction with online-only banks has declined in the last year, JD Power Report found.

While satisfaction with online-only banks remains higher than traditional banks, satisfaction with online-only checking accounts dropped 27 percentage points from 2023. Online-only savings accounts also dropped, but the drop was only 8 percentage points.

“Despite the significant increase in deposit rates for both checking and savings accounts, overall satisfaction still declined, even though the percentage of customers who had to pay fees or experienced problems decreased,” said Paul McAdam, senior director of banking and payments intelligence at J.D. Power. “This is because customers who did experience problems had such a hard time getting their issues resolved in a timely manner that satisfaction with the ease of resolving the issue fell sharply.”

Online banks also lacked the visual appeal and design to maintain their current look last year, leading some consumers to consider switching banks. Additionally, many customers dislike the limited range of services offered by some online-only banks.

According to the J.D. Power report, the three banks with the highest satisfaction ratings for checking accounts were Charles Schwab, Ally Bank and Capital One, while the banks with the highest satisfaction ratings for savings accounts were Goldman Sachs, Ally Bank and Capital One.

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Credit card usage is on the rise as inflation continues

Many bankers don’t trust AI in banking technology

AI is a divisive topic in many industries, and banking is no exception. How and when AI can make bank customers’ lives easier is up for debate. Customers are divided, with research firms reporting that only 28% believe AI can help their banking jobs. JD Power Report.

A further 17% believe AI will make their lives worse, with nearly 24% still not fully forming an opinion about AI in the fintech world.

Customers appear to value AI technology more if they use it regularly, or at least are familiar with it: Nearly half of those with AI experience say AI would help make their lives better, compared to just 6% of those unfamiliar with AI.

Both sides report that they would be able to set aside negative feelings about AI if the tools it creates had an immediate impact on their finances.

When it comes to shopping for a personal loan, Credible does the heavy lifting for you: With the click of a button, you can browse multiple lenders, rates, and terms in one place.

With the cost of living rising, many personal loan borrowers rely on loans to meet their day-to-day expenses.

Do you have a finance-related question but don’t know who to ask? Email a trusted money expert email address: Your question might be answered in Credible’s Money Expert column.

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