Over half of UK SMEs (52 per cent) are currently re-evaluating their bank’s suitability for them, according to new research from business solution provider SAP. Meanwhile, only 22 per cent of UK consumers remain satisfied with their bank’s support, suggesting change is needed to best serve banking customers in the region.
An SAP survey of 2000 consumers and 500 senior decision makers from UK-based SMEs explored how a range of factors impact customer attitudes and behaviours towards banks financial services.
Nineteen per cent of females check their account after every transaction (compared to just 14 per cent of males). Females emerged as almost three times less likely to have moved money from online-only providers to high-street banks (11 per cent of males vs. four per cent of females).
This research suggests there is a consumer need for banks to re-evaluate their products and messaging to ensure gender relevance and to address various needs and behaviours.
Age also appears to determine banking behaviour as customers look for different financial options and services based on digital and financial maturity.
Those aged 55 and over were found to be more than twice as likely to switch providers based on sign-up offers and better interest rates compared with the Gen Z audience (36 per cent compared to 16 per cent). Meanwhile, 24 per cent of Gen Z have switched their bank in the last year based on digital experiences – while less than one in 10 (nine per cent) of those over 55 have done the same.
Anuj Kumar, industry strategy and GTM lead for financial services at SAP, said: “The message from UK banking customers is clear – providers are failing to deliver the personalised services and support and this is breeding dissatisfaction. The time is now for banks to hit the reset button and ditch the one-size-fits-all approach to targeting and recognise each segment acts and behaves differently.”
Businesses reliant on banks due to economic pressures
Businesses that turn over between £100million and £499million are almost twice as likely to be reliant on their bank for support and guidance during the cost-of-living crisis than those that generate between £10million and £49million each year (61 per cent vs. 37 per cent).
Michael Walsh, head of financial services at SAP, suggests: “SMEs are key to the growth of the UK. Banks need to re-think how they engage with the SMEs. Size, experience of the executive, industry and the SME’s own growth ambitions are significant factors driving how they use the financial services sector.
“Typically focus has been on working capital (financing, lending, overdrafts). With the ever-increasing digitisation of capabilities, banks need to re-think how they serve SMEs. Future focus has to be about support to help SMEs access new customer bases with collaborative ecosystem and networks leveraging emerging intelligent platform technologies.”
UK banking customers want enhanced support
SAP’s survey also reveals that UK banking customers are calling for greater personalised education and support to offset economic concerns.
On average, 20 per cent of consumers call for better and easier access to support, education and digital tools amidst current economic pressures. Age plays a key role in this respect; with Gen Z (20 per cent), Millennials (23 per cent) and Gen X (20 per cent) calling for their bank to deliver guidance on where to access support when things go wrong. Fewer than one in 10 Baby Boomers demand the same however.
Gender also informs calls for greater education. Twenty-one per cent of females would ask for their bank to post more online content with tips and advice, compared to only 11 per cent of males. Both men and women placed equal demand on interest rates support and education (16 per cent) and the development of accessible budgeting tools (16 per cent).
Similarly, UK SMEs are equally clear on where banks need to deliver education and support. Fifty-three per cent of companies that turnover between £100million and £499million want to be informed on where they can access lending and funding options, while 43 per cent of much smaller companies, generating between £100,000 and £999,000, would like more communication and advice on where to access support when things go wrong.
The SAP survey also found that 60 per cent of companies sized between £50million and £499million want their bank to invest in additional analytics and automation to help drive new insights and streamline their operations.
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