Cape Town - At a time of unprecedented financial challenges for banks and consumers, Capitec Bank has again succeeded best in keeping its customers happy, although at least one of the other major banks has made big strides in catching up.
Capitec remains South Africa’s top bank for customer satisfaction, according to the annual South African Customer Satisfaction Index for Banking, conducted by market research firm Consulta. The index provides a reliable indication of how well our big retail banks are meeting consumers’ banking demands.
Consulta polled almost 12 500 customers from the lower, middle, and upper retail banking segments on their overall satisfaction with South Africa’s big six retail banks – Absa, African Bank, Capitec, First National Bank (FNB), Nedbank and Standard Bank – during 2020.
The survey uses a number of factors to arrive at an overall customer satisfaction score: customer expectations, perceived quality and value, customer complaints and resolution, customer loyalty, and the perceived fair treatment of customers.
On the overall score, Capitec led the field with 84.7 points. It was followed by African Bank (83.4), Nedbank (81.1), FNB (80.2), Absa (78.6) and Standard Bank (77.7). The industry average was 79.6.
The report says that although Capitec remains in front, Nedbank in particular is closing the gap.
“Nedbank continues to make consistent year-on-year improvements and has for the second consecutive year outperformed FNB. Nedbank’s improvement, which has focused on getting its positioning, pricing, messaging, customer-facing and online channels right, is paying dividends.
“This is further demonstrated in a Banking Market Share study conducted by Consulta in 2020, which shows that despite the turbulent year, Nedbank maintained its market share, while all other banks declined in market share, except for Capitec, which grew by 4%.”
Although African Bank came second, its score of 83.4 points was more than two points lower than its 2019 score of 85.7 points.
The report notes that Absa and Standard Bank have shown some improvement but “are still struggling with their value proposition to clients – both banks have performed below the industry par over the previous five years”.
With the onset of the pandemic a year ago, banks earned significant goodwill and loyalty with their debt-relief responses. (According to the Banking Association of South Africa, by October 24, banks had provided businesses and individuals with R33.6 billion in payment breaks on credit agreements and R16.71bn under the loan guarantee scheme.)
The Consulta report suggests that they will need to work hard to take advantage of this goodwill, as “a protracted pandemic tests every facet of customer resilience and loyalty in a tough and uncertain economy”.
Ineke Prinsloo, the head of customer insights at Consulta, says 2020 was a “tumultuous year” for banks in terms of customer satisfaction and loyalty.
“Banks and their customers adapted to new technology platforms and unprecedented circumstances. On one side, banks were heavily challenged in ensuring that their business operations and customer service channels continued unencumbered, despite not having made provisions for the massive increased costs of doing business in a black swan pandemic environment. On the other side, consumers faced devastating (financial) challenges.
“Customer satisfaction and experience in the banking sector are now decentralised and shaped across a wide and complex array of online and offline service platforms – from contact centres, to banking apps, to webchats, to in-branch visits right through to rewards programmes.
“Banks are under pressure to ensure that functionality is value-adding, seamless, simple, and provides resolution for every customer enquiry.
“In a tough economic environment where household income and expenses are under enormous pressure, customers place far more emphasis on perceived value for money, quality of service received, and emotional brand connections,” Prinsloo says.
Gerrie Fourie, the chief executive of Capitec, says the pandemic prompted people to reassess their priorities.
“We knew we needed to respond with care the instant the pandemic hit. From March onwards, we implemented several initiatives to support our staff and clients. Clients expected multi-channel experiences and exceptional customer service, especially given the emotional toll of sustained financial pressure. Capitec was well-positioned to deliver, which meant it was the only bank to grow its market share last year,” says Fourie.
“Technology is a big part of our strategy. Technologies such as AI, backed by good quality data, enable us to create tailored, user-friendly self-help solutions that prompt good financial decision-making, as well as better risk assessments and incentives for our clients. This is vital for our clients’ well-being, especially considering that 51% of them are under-35s who are very comfortable with technology.”
Fourie hopes that together, South Africans can emerge from the pandemic stronger.
“We need to emerge from this in a way that brings positive change. We need to pursue rescuing the economy with single-minded focus. Our institutions will have a very important role to play in this recovery,” he says.