Banking blues: UK survey says consumers lose trust as greedy and impersonal banks fail to offer advice amid financial downturn

London 26 January 2009 The full scale of UK consumers anger with financial institutions has been revealed for the first time in a new survey released today by communications consultants Cohn Wolfe.

UK consumers perceive their banks to be greedy and impersonal , according to the Cohn Wolfe Financial Confidence Survey, which polled 852 consumers in January. The study also revealed that 60 per cent of consumers don t believe that their bank is looking after their best interests.

When asked which words best describe the perception of their financial institution, consumers identified greedy 49 per cent , impersonal 36 per cent and distant 34 per cent . Positive and desired descriptions including ethical two per cent , trustworthy four per cent and transparent five per cent were among the least common terms used by consumers to describe their financial institutions.

Furthermore, the survey shows that financial providers are neglecting consumers in these testing times. Almost three quarters 74 per cent of consumers have not been contacted by their financial providers with advice on financial planning.

Ros Hunt, head of financial services at Cohn Wolfe, commented: Given the broader economic climate and the crisis which has hit this sector, we anticipated seeing consumers report deterioration in trust. However, the depth of resentment surprised us, demonstrating how badly customers perceive financial organisations.

We are also surprised that financial services businesses have not made more effort to engage with consumers. People need and appreciate guidance and offering it in difficult times will help win customer loyalty. We would urge banks to consider how they can use their expertise to help consumers manage their finances in these conditions.

Almost two thirds 64 per cent of respondents trust in financial institutions had weakened over the last 18 months. A lack of confidence in banks was further emphasised, with 74 per cent of consumers saying that they do not believe that their bank would help them recover any money they had lost in 2008.

Respondents also identified the financial services they trusted most. Retail banks were comfortably 59 per cent the most trusted type of financial service. At the other end of the scale, investment brokers two per cent , insurance providers five per cent , online financial service providers and supermarket retailers both six per cent come off worst.

Consumers said that measures such as banks putting an end to excessive bonuses 48 per cent and showing a greater willingness to pass on interest rate cuts 47 per cent would help renew trust in banks. Greater transparency in how banks operate and communicate 27 per cent was the third most common measure identified by respondents.