Big four banking customers ready to switch lenders
Many disgruntled customers have lost confidence in the big four banks and say they are going to leave or are considering it.
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Exclusive: Many disgruntled customers have lost confidence in the big four banks and intend to leave or are considering it, a new report has revealed.
The stinginess of the big four banks after they failed to pass on this month’s Reserve Bank cash rate cut in full, combined with them continuing to deliver billion dollar profits has not helped their cause.
In a new report by financial comparison website Mozo it found seven in 10 of Australians no longer trust the big four banks.
And of those half said the reason was because the banking giants failed to pass on the recent rate cut in full.
This month of the big four banks — the Commonwealth Bank, National Australia Bank, Westpac and ANZ — they passed on between 0.13 and 0.15 percentage points of the 0.25 percentage point cut.
Mozo’s spokeswoman Kirsty Lamont said the findings highlighted Australians “think enough is enough with the big banks”.
“They are starting to embrace or consider alternative banking providers,” she said.
“Traditionally Australians have been really stuck on their relationships with the big banks and one of the reasons for that is because they think they are a safe place for borrowing and depositing.”
Ms Lamont said banking with a the big four often resulted in customers “paying a premium in terms of a borrowing interest rate or not getting a competitive rate on your savings”.
The report also found 62 per cent also said the big four banks put their profits before their customers.
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Home Loans Experts’ managing director Otto Dargan said there was a “trust crisis in financial services”.
“We regularly recommend smaller lenders with a better interest rate however we find that around half of customers still ask us to submit their loan to a major bank,” he said.
“People don’t trust the banks, but they still want a big brand so I question if these customers will actually leave.
“There’s plenty of smaller lenders with great rates and all the features people love such as a great phone banking app.”
Aussie Home Loans’ chief executive officer James Symond said they were seeing two thirds of their customers settling their loans with lenders other than the big four.
“This is not to say there are not good options to be had with the big four banks, more so that competition is alive and there are real alternatives available,” he said.
“With thousands of loan options in the market we understand that it can be confusing and overwhelming for borrowers to know where to start and what to choose.”
Originally published as Big four banking customers ready to switch lenders