Insights on Banking and Consumer Behavior Research - National Consumer Agency
The National Consumer Agency conducted a market research study in February 2014 on Banking and Consumer Behavior, revealing key findings such as the impact of losing free banking, switching behaviors, and complaints made by current account holders. The research highlights significant trends in financial institutions, use of services, and the prevalence of current accounts among adults in Ireland.
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National Consumer Agency Market Research Findings: Banking & Consumer Behaviour February 2014 Research Conducted by
Table of Contents 2 Key Findings Banking & Consumer Behaviour Research Background and Methodology Making Complaints Profile of Sample www.consumerhelp.ie
3 Key Findings Making Complaints www.consumerhelp.ie
Key Findings 4 8 in 10 adults have a current account. 34% of current account holders have had their free banking withdrawn in the past 12 months. The key behavioural changes from losing free banking are; taking out more cash on each withdrawal (28%), using debit cards less often (25%) and using credit card more for routine transactions (13%). Making Complaints At this point, 32% of current account holders state that they have free banking. Switching to a bank with lower fees are the main consequences should free banking be withdrawn. 6% have switched their main current account in the past 12 months. 8% intend switching their current account in the next six months. Nearly 3 in 5 (57%) have never checked to see if there was a better deal/package available. www.consumerhelp.ie
5 Banking Consumer Behaviour Making Complaints www.consumerhelp.ie
Use of Financial Institutions Base: All Adults 16+, 1,008 6 % 90 Any Financial Institution 94 95 79 Bank 86 86 42 Credit Union 39 Making Complaints 43 Female 65+ ABC1 Dublin 10 An Post 13 14 9 Building Society 11 10 35-64 ABC1 Dublin/ROL W10 W11 W10 November 2012 W11 June 2013 W12 November 2013 10 None of these 6 5 W12 U 24s www.consumerhelp.ie Q. Do you have any accounts with, or use, financial services provided by any of the following?
Majority have a Current Account Base: Any financial account holders - 963 7 W10 % W11 % W12 % W10 November 2012 W11 June 2013 W12 November 2013 (17%) 83 85 86 Making Complaints Yes have a current account No 17 15 14 85% of those with financial accounts hold a current account this equates to 80% of the total sample. www.consumerhelp.ie Q. And do you have a current account?
A third of current account holders have had their free banking withdrawn in the past 12 months Base: All who have a current account 8 Has Your Bank Changed Fee Structure for Fee Free Banking? W10 (740) W11 (815) W12 (820) % % % W10 November 2012 W11 June 2013 W12 November 2013 22 31 34 Highest amount among 35-49 (42%)/Dublin Yes Making Complaints No 43 50 48 35 Don t know 19 18 34% of current account holders have had their free banking withdrawn in the past 12 months. www.consumerhelp.ie Q. Within the past 12 months has your bank changed its fee structures so that you no longer qualify for fee free banking?
Behaviour changes resulting from losing free banking Base: Those with a current account who no longer qualify for free banking - 278 9 Take out larger amounts of cash when making withdrawals % Switch to a bank that offers free banking that I will quality for % Switch to a bank that has lower fees/charges Use Debit/laser cards less often Use my credit card more for routine transactions % Jun 13 I would close my account % % % Nov 13 Nov 13 Jun 13 Jun 13 Nov 13 Jun 13 Nov 13 Nov 13 Nov 13 Jun 13 Jun 13 6 7 7 7 8 8 13 15 22 23 25 I have done this 15 28 17 16 30 15 30 33 32 Making Complaints 16 I intend to do this 26 22 31 79 76 72 71 63 63 63 60 59 52 Will not do this 49 44 28% of consumers now take out larger amount of cash when making withdrawals and 25% state they use their debit/laser card less often. www.consumerhelp.ie Q. Has this change in fee structure prompted you to change or do you intend to change the following ways you use your current account?
Reduced use of debit cards and making larger cash withdrawals evident Base: Those with a current account who no longer qualify for free banking 10 % I intend to do this . % I now do this . 23 15 Take out more cash when making withdrawals Use my debit laser card less often 26 22 31 28 22 Switch to a bank that offers me fee free banking 13 30 Use my debit / laser card less often Making Complaints 25 23 32 21 Switch to a bank that offers lower fees / charges 30 33 W10 W11 W10 November 2012 W11 June 2013 W12 November 2013 20 Close my account 15 W12 17 There is also the intent however to consider banks with lower fees and charges. www.consumerhelp.ie Q. Has this change in fee structure prompted you to change or do you intend to change the following ways you use your current account?
Incidence of free banking and likely behaviour if free banking was removed Base: All current account holders - 820 11 % % Don t know June 2013 (815) Don t know November 2013 (820) 14 12 Currently pay for banking Currently pay for banking 51 53 32 37 Currently have fee free banking Currently have fee free banking Making Complaints Nov 13 vs June 13 Consequences of change to fee free banking structure (All with fee free banking 304) Consequences of change to fee free banking structure (all with fee free banking 271) I would switch to a bank that offered fee free banking that I I would switch to a bank with lower fees/charges I would use my debit/credit card less often I would take out larger amounts of cash when making withdrawals I would use my credit card more often for routine transactions I would switch to a bank that offered fee free banking that I I would switch to a bank with lower fees/charges I would use my debit/credit card less often I would take out larger amounts of cash when making withdrawals I would use my credit card more often for routine transactions 34 39 +5% 19 26 +7% 8 18 +10% 10 13 +3% 6 3 -3% 8 8 = I would close my account I would close my account -17% 32 15 No affect at all No affect at all Q. Do you have fee free banking with your current account at the moment? Q If fee free banking was no longer offered by your bank or the criteria for fee free banking was changed so that you no longer benefited from fee free banking, how would this be likely to affect your banking behaviour? www.consumerhelp.ie
Current Account - Switching Behaviour 12 Switching current account in next 6 months (Base: All current account holders) Switched current account in past 12 months (Base: All current account holders ) Most recent checking on alternative providers (Base: All current account holders) Bank/Financial institution who offers current acc service Yes, I plan on switching % Yes, I have to bank is closing down Switched % 18 Past 12 months 1 7 More than 12 months but less than 3 years ago More than 3 years 14 Making Complaints 2 2 Bank financial institution with current A/C service 10 4 4 ago 6 92 57 Nov-11 Jun-12 Have never checked No, I do not plan on switching Nov-12 Jun-13 Nov-13 6% have switched their main current account in the past 12 months. 8% intend switching their current account in the next six months. Nearly 3 in 5 (57%) have never checked to see if there was a better deal/package available. Q. Have you switched providers for any of the following products or services within the past 12 months? Q. Do you plan on switching the bank that you have your main current account with in the next 6 months? Q. When was the last time you checked to see if there was a better deal/package available for? www.consumerhelp.ie
13 Research Background Making Complaints and Methodology www.consumerhelp.ie
A. Research Background and Methodology 14 Nov/Dec 2009 Nov/Dec 2007 May/June 2009 Nov/Dec 2008 Aug 2008 Wave 1 Wave 3 Benchmark Wave 2 Wave 4 Nov/Dec 2010 May/June 2011 Nov 2011 June 2010 Making Complaints Wave 6 Wave 7 Wave 8 Wave 5 June 2012 Nov 2012 June 2013 Nov 2013 Wave 11 Wave 9 Wave 10 Wave 12 The research was conducted face-to-face using CAPI interviewing with 1,008 adults 16+. To ensure that the data is nationally representative, quotas were applied on the basis of age, gender and social class. Interviewing was conducted from 12th 21st November 2013. www.consumerhelp.ie
Profile of Sample Base: All Adults 16+ 1,008 15 Employment Status % Gender* % Age* % Class* % Region* % 16-24 15 Dublin Working full 29 29 time ABC1 40 25-34 Male 49 21 Working part 12 Making Complaints time Rest of Leinster 26 Self-employed 6 35-49 28 14 Unemployed C2DE Munster 52 16 27 Home duties Female 50-64 51 21 Retired 16 Conn/ Ulster 65+ 18 15 F 8 7 Student www.consumerhelp.ie
Profile of Sample Base: All Adults 16+ 1,008 16 Access the Internet (All Adults) % Purchase Online (All Adults) % Bank Online (All Adults) % Social Media Sites Used (All who access the internet 820) % Facebook 57 Yes 44 Yes 57 Twitter 13 Yes at home 80 Making Complaints LinkedIn 6 Bebo 2 No 56 Yes at work No 11 43 None 40 No access 19 www.consumerhelp.ie
