Canadian banking customers are feeling the impact of inflation and economic instability. Plus, there are the recent Bank of Canada interest rate hikes. Many are seeking help from their banks on how to manage these challenges. Unfortunately, a recent study shows they’re not getting the help they need.
J.D. Power Canada Retail Banking Satisfaction Study
The J.D. Power Canada Retail Banking Satisfaction Study is an annual survey that looks at how happy customers are with the banks in Canada. The survey asks customers of large and medium-sized banks about their experiences. It had two parts: one from January to March and another from July to August.
The survey measures how satisfied customers are in different areas, like:
- Solving problems
- How easy it is to use the bank
- The products and fees
- Banking online
2023 Results
The results of the study came out on June 29, 2023. It found that nearly 66% of bank customers in Canada are financially unhealthy. Many said their net income was not enough to cover costs. This is mostly due to economic pressures caused by:
- Inflation
- Economic uncertainty
- Rising interest rates
The results showed that banking customers are looking for personalized financial advice yet, only 42% of customers remember receiving any advice. Even more enlightening is that of those customers, only 50% found the advice to be useful. It’s safe to say that there is a lot of room for banks to increase customer satisfaction and engagement.
The study revealed that by meeting even just one of the top three key performance indicators (KPIs) below, customer satisfaction rose dramatically:
- Advice completely meets the customer’s needs
- Bank representative shows genuine care for the customer’s concerns
- Advice is highly tailored to the individual
What are the benefits of personalized financial advice?
Personalized advice can lead to higher financial literacy and success. Tailored information and guidance specific to your situation can help you:
- Achieve your short and long-term goals
- Protect your total assets and loved ones
- Take control of your finances at any stage of your life
- Improve your physical health and personal happiness
Our mental and financial well-being are closely connected. Money problems can cause a lot of stress and impact our mental health. At the same time, poor mental health can make it harder to manage our finances.
Alternative sources of financial advice
There are several options for people to find more personalized advice.
Financial Planner
A financial planner can help you manage your money and achieve your goals. They have extensive knowledge of personal finance, taxes, budgeting, and investing. They may specialize in:
- Tax planning
- Asset allocation
- Risk management
- Retirement planning
- Estate planning
Financial planners work with individuals, families, or corporations to help manage their current and long-term financial needs.
Hiring a financial planner can help you:
- Set and assess your goals
- Develop a comprehensive financial plan
- Understand your current situation
- Increase savings
- Pay off credit card debt
- Become more strategic in your investing
Financial Advisor
A financial advisor can help you make informed decisions on specific money matters. It’s a general term that applies to anyone who helps you manage your money. Financial advisors are not always bank employees. They can work for an independent firm or as part of a larger network. They could also be employees at a bank, brokerage, or investment company.
While financial advisors and financial planners are similar, there are some key differences. Advisors focus on investment management, like mutual funds or guaranteed investment certificates (GICs.) Planners create long-term strategies that encompass all aspects of your finances. Financial planners help you understand the broader picture of your finances.
Credit Unions
Credit unions and banks in Canada offer similar banking services, but the two have some differences. Here are some of the pros and cons of Credit Unions.
Pros
Membership – To open a chequing account at a credit union, you need to become a member, which can provide a sense of belonging and personalized service.
Safety – CDIC member credit unions have deposit insurance, just like banks.
Fees – Credit unions generally charge lower fees and require lower minimum bank account balances.
Interest rates – Credit unions usually offer a lower interest rate on loans and higher interest rates on savings accounts.
Non-profit status – Credit unions are non-profit organizations. Any profits they make come back to their members as better rates and lower fees.
Cons
Limited product offerings – Banks usually offer more financial products and services
Fewer physical locations – Banks usually have more branches and ATMs
Less advanced technology – Banks may have more advanced apps and online technology
Choosing a financial institution depends on your personal banking needs. It is a good idea to compare the financial services, fees, and interest rates of both types before opening an account.
Conclusion
Customers want a more personalized experience from banks in Canada. There are huge advantages to be had for any bank that seizes the opportunity to fulfill the need for personalized advice. Thankfully, in the meantime, there are other ways to get more personalized service.
If you need personalized advice on how to get out of debt, our expert credit counsellors are ready to help. Contact one of them today to get started.
