Fergie's Tech Blog

Banking Customers More and More Mistrustful of Financial Institutions

Nancy Feig writes on Bank Systems & Technology:

The growing ranks of banking customers are becoming more and more mistrustful of their financial institutions, according to IBM (Armonk, N.Y.). In a new twist on the issue, the trend is increasing in younger generations of consumers, IBM says, threatening banks' long-established position as trusted financial advisers.

Consumer mistrust of banks is a familiar topic. But typically the reports are from the standpoint of the so-called "unbanked" or "underbanked". Recent immigrants not familiar with their new country's established banking system or unfamiliar with the language, or much older people who can still recall the Great Depression, are recognized as often being mistrustful of established financial institutions. The trend identified by IBM, however, has less to do with language or preconceived emotions and much more to do with the performance of the banks themselves.

Concurrently, a new survey from Unisys (Blue Bell, Pa.) found that 71 percent of U.K. consumers do not trust their banks. The attributes most cited in the survey for eroding trust are disrespectful attitudes, poor privacy, weak IT (such as Web sites), poor corporate governance and a lack of investment in the local community.

posted by Fergie @ 8/08/2007 01:40:00 PM