Banking customers are most likely to recommend First Direct, according to a new six-monthly survey aimed at improving competition in the banking sector.
From today, banks must publish data on whether their customers are likely to recommend them to others, based on their online and mobile banking, branch and overdraft services.
The Competition and Markets Authority (CMA) has introduced this measure after an in-depth investigation of the sector.
As part of the CMA’s study, 16,000 customers of the 14 largest business current account providers and 16 largest personal current account providers were asked whether they would recommend their provider to friends and family.
The findings of the CMA’s investigation must now be prominently displayed in banks’ branches, as well as on their websites and apps, making it easier for customers to compare products and customer service. The index will be updated every six months in February and August.
In today’s report, the top bank for overall service quality was First Direct, with 85% of customers polled saying they would recommend the bank’s current account to friends and family. This was closely followed by Metro Bank (83%), while Nationwide (73%) claimed third spot.
Royal Bank of Scotland (RBS) came bottom, with less than half (49%) of customers saying they would recommend the bank.
This reflects Moneywise’s own Customer Services Awards 2018, which saw First Direct win the most trusted current account provider and Metro Bank highly recommended as the runner-up, while RBS was voted least trusted financial provider.
Adam Land, senior director at the CMA, says: “For the first time, people will now be able to easily compare banks on the quality of the service they provide, and so judge if they’re getting the most for their money or could do better elsewhere. This is one of the many measures – including open banking and overdraft text alerts – that we put in place to make banks work harder for their customers and help people to shop around to find the best deals for them.”
The CMA has also been working with the Financial Conduct Authority (FCA) to ensure that banks release further information on their performance, giving consumers the means to assess whether they are with the best bank for them.
The FCA will now require banks to publish details of services and relevant helplines. Plus, banks will have to provide updates on their websites about the number of major operational and security incidents they have experienced. This follows a raft of operational glitches in recent months, notably the TSB computer meltdown.
From February 2019, the regulator will also require banks to publish data on how long it takes to open current accounts and replace debit cards.
Eric Leenders, managing director of personal finance at banking trade body UK Finance, adds: “Giving consumers more information about the service personal current account providers offer will encourage customers to shop around and find the best account to suit their needs. It will also assist in continuing to drive up service standards across the board.”