Building societies vs banks: the customers' verdict is in...
With so many financial providers out there these days – from digital start-ups to well-known high-street banks and building societies – making the right choice for your mortgage or savings isn’t always easy.
Which is why some research from Smart Money People, the UK’s number one financial services review website, caught our eye. It set out to identify some of the key differences people experience when dealing with banks and building societies – with some interesting results…
What's the research saying?
In 2018, Smart Money People received feedback from 4,123 savings and mortgage customers across 31 banks and 22 building societies.*
Overall, results showed that when it came to both savings and mortgages, building society customers felt more satisfied and fairly treated than their bank counterparts.
Breaking results down further, Smart Money People found satisfaction amongst building society savers 7% higher than those with banks. Customer satisfaction scores came in at 95% for building societies versus 88% for banks.
Whilst interest rates are obviously important, the research shows that’s just part of the story. It appears building society customers value the whole package, including knowledgeable face-to-face service, the importance of local branches and overall value for money.
Making the most of mortgages
The report is also good news when it comes to building societies and mortgages. Customer satisfaction for homebuyers scores 13% higher for building societies compared to banks.
Whilst banks focus on cost and a straightforward process, it’s a combination of factors which swing opinion in favour of building societies. These include:
- Skills and knowledge
- Overall customer service
- Flexible lending
- Catering to niche markets
As with savings, mortgage customers value face-to-face engagement and the opportunity to talk things through with knowledgeable staff.
Online or in-branch?
The report also threw up some intriguing insights around how customers prefer to engage with banks and building societies.
Building society customers are seeking enhanced flexibility on their accounts, with 66% of customers aged 65 and over now preferring digital channels and 13% of these favouring banking apps. However, it’s worth noting that 24% of customers in this same age group still see branches as an important lifeline.
Interestingly, customers aged 18-24 – those who have grown up with digital devices – are the biggest users of telephone banking, with 15% opting to dial in to deal with their finances.
Meeting the digital challenge
So the challenge is how building societies meet their customers’ digital wish list, without losing that incredibly important face-to-face, personal and engaging touch that comes with a branch based service. It’s something we’re committed to here at Leeds Building Society and something our CEO Richard Fearon addressed during the release of our annual results for 2018:
“Investment during 2019 will be the highest in our history so we can carry on helping more members save and have the home they want, while increasing our digital capability and moving forward with pace and focus to meet and surpass their expectations. This is possible thanks to the fact we’re financially stronger than we’ve ever been, because of our sustained and carefully-managed growth, supported by record profits in recent years.”
The mutual promise
In summary, it seems like there’s just something special about mutuals – or a combination of things – that really drive excellent customer service.
At Leeds Building Society, we will always focus on what matters to you, and we’ll strive to deliver this in the best way possible.
We’ve been doing this for over 140 years now, and we we’ll keep doing so with the same passion and integrity that customers have clearly recognised in the mutual approach. Here’s to the next 140 years!
*You can find the full survey here.