Aussies can only take so much with the country’s major banks before losing trust, according to new research.
Nearly three-quarters (71 per cent) of Aussies said they had lost at least some level of trust in banks, based on high interest rates and fees, while 74 per cent said they would consider switching to more affordable online services.
Money Transfer Comparison, a comparison website for money transfer rates, commissioned a survey of 1,009 Australians to gauge whether high loan interest rates and fees had caused them to lose trust in the banks.
The survey found 42 per cent of respondents had lost trust in some bank services and 28 per cent had lost trust in traditional banks as the best platform for all of their financial undertakings.
A slightly higher proportion (75 per cent) of respondents said they were willing to switch their financial undertakings to non-traditional services, when they believed their banks were charging too much.
When comparing the results across the states, the research found those living in New South Wales and Victoria - who were likely paying off larger mortgages - had lost the most trust in the big banks.
Younger age groups were also more likely to have lost at least some level of trust in traditional banking - 74 per cent of 18-54-year-olds, compared with 58 per cent of over-65s.
The research revealed that Queenslanders were the savviest bargain hunters, with 82 per cent willing to be more diligent in comparing financial-services-provider fees and to switch to more cost-effective online services if they were being charged too much.
Victorians seemed to be most trusting of the banks, with just 68 per cent saying they would compare providers and switch if they felt they were being charged too much by their banks.
Money Transfer Comparison managing director Alon Rajic said the research showed the majority of customers were not blindly loyal to their banks – and would move elsewhere if rates and fees increased disproportionately.
“With so much information available online, and so much competition in the market, it is very easy for consumers to compare interest rates and fees across dozens of financial service providers,” Rajic said.
“I am encouraged to learn that three in four Australians are willing to make the switch to low-cost and innovative financial platforms if they can get a better deal. A significant consumer shift from traditional banks to innovative fintechs may also drive banks to increase their competitiveness.”