The way in which consumers use financial services, is undergoing significant change. The growth of electronic banking, including the use of Automated Teller Machines (ATMs), debit cards, telephone and the Internet for banking transactions is influencing how consumers conduct their day-to-day financial transactions. It has also affected how consumers view financial institutions.
PIAC undertook a national survey to establish a benchmark of consumer s attitudes, expectations and experiences about core banking services and practices in Canada. This research is intended to be of use by PIAC and other consumer organizations, as well as government and industry. One important purpose of the survey is to assist consumer organizations in representing Canadians in financial services policy and regulatory activities.
The survey issues included:
* How Canadians bank institutions and services used, incidence of on-line banking
* Experiences with financial institutions complaints, bank machines, branch locations, satisfaction with services
* Competition level and perceptions of competition between banks; extent to which consumers switch institutions
* Mergers Canadians views of prospective bank mergers, personal impact of a bank merger
* Canadian control of financial institutions – Canadian attitudes; attitudes regarding relationship between banks and government policy makers
Survey Highlights:
Rise of Internet banking. 33% of Canadians now do some of their personal banking through the Internet alone. This change has been rapid. As recently as 1999, two-thirds of Canadians indicated that they did not use either Internet or telephone banking. Now, a majority of Canadians indicate they use the Internet or the telephone for personal banking.
Embrace of electronic banking. 85% of Canadians use a bank machine at least once a month and almost half (49%) of Canadians, when surveyed indicated they had used a debit card 11 times or more in the previous month.
In person banking still matters. When surveyed, over 52% of Canadians had visited their bank in-person, one to four times in the previous month. A majority of Canadians (61%) also indicate that it is important to be able to do their banking in person, although a slightly lower majority (55%) indicate a preference for bank machines over dealing with a bank teller.
Banking is easier but of less value. A majority of Canadians think that banking is now easier than it was five years ago, but Canadians are skeptical about the return on the service fees they pay. Nearly half of Canadians don t feel they get a lot of value for the service fees they pay (46%).
Canadians are very concerned about the prospect of bank mergers. Almost three-quarters of Canadians are concerned that there will be significant job losses and bank closures if there is a merger between large Canadian banks. Overall, Canadians are more apprehensive about the effects of bank mergers than they were five years ago. (In 1998, 64% agreed with the statement that there would be significant job losses and bank closures following bank mergers.)
Income gaps growing regarding use of electronic banking. A fault line between income groups is growing along side the growth of electronic banking. The greater one s income, the more likely one is to use ATMs or the Internet for banking. When surveyed, 86% of those in the lowest income bracket had not used the Internet for banking in the previous month, compared to more than half of those in the highest income bracket. Those in the lowest income bracket also exhibit the lowest use of debit cards and the highest incidence of in-person banking.
There are a number of awareness issues for consumers:
* Two-thirds (67%) of Canadians claim to be aware of the fees charged for using no-name bank machines;
* About two-thirds (64%) of Canadians are unaware that some major banks in Canada own no-name machines that charge more than a bank s own machines;
* A majority of Canadians are not aware that financial institutions have their own ombudsman to help deal with customer complaints (56%) and almost three-quarters of Canadians are unaware that there is a federal agency which assists customers in their dealings with financial institutions (72%);
* A majority of Canadians are unaware of their financial institution s policy on the use of customer information (52%).
The survey, conducted in January 2003, was based on a national random sample of 1,502 Canadians aged 16 and over and is considered accurate +/- 2.6 percentage points, 19 times out of twenty. The research was conducted for PIAC by Ekos Research Associates Inc.
Bankwatch 