Description

“The pandemic has shown that the financial services sector has learned from the previous recession when it comes to building trust with its customers. Supportive messaging and financial relief programs have all aided consumers during the economic fallout, leading to an increase in trust within the industry. How providers are able to sustain this goodwill and trust remains to be seen, however. Financial institutions have already shown more commitment toward the best interest of the customer, with the permanent removal of overdraft fees among the most notable. Actions like these could potentially spur a shift in how the industry can become more customer-centric and engaged with its customers’ financial wellbeing – building more trusting and loyal relationships in the process.”

– Amr Hamdi, Finance Analyst

This Report looks at the following areas:

  • The impact of COVID-19 on consumer behavior and trust within financial services.
  • How trust changes across a variety of financial brands.
  • What consumers seek when choosing a financial services provider.
  • The most important factors that contribute to trusting a financial services provider.

Table of Contents

  1. Overview

    • What you need to know
      • Key issues covered in this Report
        • Economic and other assumptions
          • COVID-19: US context
          • Executive Summary

              • Top takeaways
                • Familiarity breeds trust
                  • Figure 1: Trustworthiness of bank brands, 2021
                • Providers should proactively reach out and engage with low-earning households to regain their trust
                  • Figure 2: Trust in financial services industry throughout COVID-19, by financial situation, 2021
                • Consumers want providers that are invested in their financial wellbeing
                  • Figure 3: Top factors of trust, 2021
                • Impact of COVID-19 on trust in financial services
                  • Figure 4: Short-, medium- and long-term impact of COVID-19 on trust in financial services, 2021
                • Opportunities and challenges
                  • Continue building trust by providing personalized digital experiences
                    • FIs can build on increased trust by continuing to support and invest in the financial wellbeing of their customers
                    • The Market – Key Takeaways

                      • Major FIs showed messages of support and offered a host of financial assistance programs amid the pandemic
                        • Ally Bank permanently eliminates overdraft fees – shunning a fee structure that has negatively affected low-earning households for decades
                          • Unemployment rates continue to fall, but all those skipped bills will come back around and potentially lead to strained relationships if providers fail to respond
                            • Impact of COVID-19 on trust in financial services
                              • Learnings from the Great Recession
                              • Market Factors

                                • Major FIs showed messages of support and offered a host of financial assistance programs amid the pandemic
                                  • Figure 5: U.S. Bank gratitude email, 2021
                                • Ally Bank permanently eliminates overdraft fees – shunning a fee structure that has negatively affected low-earning households for decades
                                  • Figure 6: Ally eliminates overdraft fees, 2021
                                • Unemployment rates continue to fall, but all those skipped bills will come back around and potentially lead to strained relationships if providers fail to respond
                                  • Figure 7: Unemployment and underemployment, 2007-21
                              • Companies and Brands – Key Takeaways

                                • Charles Schwab emphasizes trust in its messaging to engage with consumers looking to achieve their financial goals
                                  • Figure 8: Charles Schwab financial planning, 2021
                                • Banks plan to better serve those with no credit scores
                                  • Bank of America’s Life Plan helps customers achieve their financial goals
                                    • Figure 9: Bank of America Life Plan, 2021
                                • Competitive Strategies

                                  • Chase pledges $30 billion to close racial and opportunity gaps
                                    • Figure 10: Chase’s Path Forward, 2021
                                  • Fidelity invests in its customers’ financial wellbeing with its financial health assessment
                                    • Figure 11: Fidelity financial health email, 2021
                                • Market Opportunities

                                  • Deepen relationships by providing a tailored and personalized customer experience
                                    • Figure 12: Trust in traditional vs non-traditional providers, 2021
                                    • Figure 13: Huntington Standby Cash email, 2021
                                  • Build trust by showing commitment to improving customers’ financial literacy
                                    • Figure 14: Dave financial literacy email, 2021
                                • The Consumer – Key Takeaways

                                  • Credit unions and banks are the most trusted financial institutions
                                    • … but trust changes as consumers age
                                      • Financial service providers should engage more with minority customers to help them achieve their financial goals
                                        • Increasing fees considered the biggest financial concern
                                        • Financial Trust by Sector

                                          • Credit unions and banks are the most trusted financial institutions
                                            • Figure 15: Trust of financial services sectors, 2021
                                          • Gen Zers are more likely to put their trust in banks
                                            • Figure 16: Trust of banks and credit unions, by generation, 2021
                                        • Trust in Financial Services Provider

                                          • Trust in providers over industry is significant across all generations
                                            • Figure 17: Trust in financial industry vs financial provider, by generation, 2021
                                          • Majority of consumers are confident in their providers’ security practices
                                            • Figure 18: Trust in financial services industry security, 2021
                                          • The pandemic has led to a loss of trust in the financial services industry among struggling households
                                            • Figure 19: Trust in financial services industry throughout COVID-19, by financial situation, 2021
                                        • Trust in Financial Brands

                                          • Chase and Capital One are the most trusted traditional retail banking companies
                                            • Figure 20: Trustworthiness of traditional retail bank brands, 2021
                                            • Figure 21: Lack of bank brand trustworthiness, 2021
                                          • PayPal, a digital banking and payments solution, is even more trusted than traditional retail banks
                                            • Figure 22: Online and mobile payment brand trustworthiness, 2021
                                            • Figure 23: Online and mobile payment brand trustworthiness, by generation, 2021
                                        • Factors of Trust

                                          • 41% of consumers want their providers to help them reach their financial goals
                                            • Figure 24: Top factors of trust, 2021
                                          • Younger consumers look to recommendations, while older ones desire personalized financial care
                                            • Figure 25: Top factors of trust, by generation, 2021
                                          • Phone and online customer service are of close importance
                                            • Figure 26: Importance of customer service interaction, 2021
                                          • Importance of financial providers’ online presence continues to grow
                                            • Figure 27: Importance of online experience, 2021
                                        • Reasons for Trusting Financial Services Providers

                                          • Security, long term relationship the top reasons consumers trust their financial providers
                                            • Figure 28: Top three reasons for trusting financial provider, 2021
                                            • Figure 29: Shop securely with PayPal email, 2021
                                            • Figure 30: Discover security TV ad, 2021
                                          • Financial service providers should engage more with minority customers to help them achieve their financial goals
                                            • Figure 31: reasons for trusting financial services provider, by race and ethnicity, 2021
                                        • Financial Services Concerns

                                          • Increasing fees considered the biggest financial concern
                                            • Figure 32: Top financial services provider concerns, 2021
                                        • Appendix – Data Sources and Abbreviations

                                          • Data sources
                                            • Consumer survey data
                                              • Marketing creative
                                                • Abbreviations and terms
                                                  • Abbreviations

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