Trust in banks is being eroded as the rapid move to digital services has all but removed person to person interactions, a new report from professional services company Accenture shows.
The report reveals that the renewed shift to mobile and online banking during the pandemic has lessened the trust people have in their bank.
Accenture's 2020 Global Banking Consumer Study is based on a survey of more than 47,000 consumers globally, including over 1,000 consumers in Ireland.
It found that without a strong emotional connection with their bank, customers are more likely to view banking services as a commodity, with price being the ultimate competitive differentiator.
Accenture said that 45% of Irish consumers ranked value for money as a top three factor, making it the most important factor when dealing with a bank, compared with 37% of consumers globally.
When asked how much they trust their bank to look after their data, 32% said "a lot".
But while overall trust might be eroding, the report found that more than half of consumers believe that when providing advice, their bank has their best interest in mind "always" or "most of the time" and 60% believe that the advice is smart, personalised and well-informed.
These factors likely contribute to why one in five consumers here believe that banks are in the best position to provide them with products and services outside of their core areas of expertise, compared with 17%, 14% and 14% of respondents who said the same for tech providers, social media companies and neobanks, respectively.
The report noted that while banks have long been encouraging consumers to use digital channels for their banking needs, there was no way to predict how "aggressively" that trend would accelerate as a result of Covid-19.
"At a time when customer trust is critically important, the recent shift to digital is putting pressure on the relationships banks have worked hard to develop," said Billy O'Connell, who leads Accenture's Financial Services practice in Ireland.
"The pandemic-inspired increase in digital engagement is creating both challenges and opportunities for banks," Mr O'Connell said.
He said the shift to increased digital banking has enabled banks to serve customers efficiently throughout the pandemic - and advanced their digital strategies by years in some cases.
But he added that the understandable focus has been on the speedy delivery of solutions that are functional, with significant potential to go further in terms of really delivering on the demands of today’s changing consumer in an innovative way.
"To forge strong customer relationships, banks now have an opportunity to reimagine the digital services they provide and make those connections more personal and relevant," Mr O'Connell stated.
