In April 2016, the Australian Bankers’ Association (ABA) initiated the Banking Reform Program – Better Banking (Program).[1]   The Program was developed to protect consumer interests, increase transparency and accountability, and to build consumer trust and confidence in banks through a range of initiatives.

Edelman Intelligence has conducted two rounds of consumer research studies to track the progress of the Program. The key performance indicators are trust, confidence and transparency.

In November 2017, 1,000 Australians participated in the second round of research and the results show significant improvements in consumers’ perceptions towards banks.[2]   The study also confirms the growing sentiment that banks are putting the needs of their customers first.

Key findings of the research include:

  • 77% of consumers indicated their main bank ‘is becoming more customer-focused’ (up 14% since the first study in June 2017).
  • 86% of consumers agreed their own bank helps customers navigate choices to make the best decisions for themselves (up 12% since June 2017).
  • 55% believe their own bank is more interested in what is good for customers (up 11% since June 2017).
  • 44% of consumers feel the banking industry is headed in the right direction (up 5% since June 2017). Conversely, the number of consumers who feel the industry is heading towards the wrong direction has dropped significantly to 18% (compared to 40% in June 2017).

With the establishment of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, it is important that the industry continues its efforts in developing and maintaining a strong level of trust and confidence.

As confirmed by the analysis, the most impactful initiatives for driving trust, confidence and transparency are strengthening commitment to the Code of Banking Practice and supporting those who are experiencing financial difficulties. Effectively dealing with poor conduct and ensuring the highest standards of whistleblower protection are also identified as important drivers of consumer trust and confidence.

[1] See https://www.betterbanking.net.au/.

[2] The full report is available at http://www.bankers.asn.au/images/uploads/Edelman_ConsumerStudy_wavetwo.pdf.