A significant proportion of bank customers were unaware of any measures taken by their main bank to help them through the pandemic in early April, according to research from RFi Group.
This assessment is based on interim data from an upcoming report on the impact of COVID-19 on banking.
The research to date revealed that 45 per cent of people are unaware of any COVID-19 support measures provided by their bank.
The caveat here is that the research was undertaken in early April as the banks were moving on their support measures.
In fact, on Sunday , National Australia Bank said it continues to provide assistance to its customers and has sent more than nine million emails and 200,000 text messages about its COVID-19 support measures so far
In addition, NAB called almost 25,000 customers about digital banking education and support, which has seen 2500 passbook customers apply for their first debit card, with 80 per cent of these over the age of 75.
NAB internet banking and mobile app recorded more than 120 million logins from 1 March to 20 April, a rise of 12 per cent from the same period last year.
Nevertheless, the data suggests that banks may need to do more to reach and reassure customers, according RFi Group deputy general manager Kate Wilson said.
“The level of awareness did differ between consumers depending on how often they engage with digital banking,” Wilson said.
For example, the research found that highly digitally engaged customers (use mobile banking daily) are also more likely to be aware of their bank’s response.
“People who are using those channels are more likely have come across information regarding COVID-19.
There is an opportunity for banks to offer greater support for younger customers, who are also more likely to have seen an impact on their personal financial situation from COVID-19 already
“However, there is greater scope for banks to use targeted email campaigns to better equip their customers with the information they need to manage their finances through this pandemic.”
Overall, the support consumers would most value from their bank during the pandemic would be a reduction in fees, followed by reassurances around the stability of the bank and repayment holidays for credit products.
Younger customers would be more likely to value a reduction in fees while repayment holidays are most valued by consumers aged between 35 – 54, reflecting the different life stages and products held by these segments.
Here Wilson said there is an opportunity for banks to offer greater support for younger customers, who are also more likely to have seen an impact on their personal financial situation from COVID-19 already.
“The banks have made all the right moves in addressing consumer hardship particularly around repayment holidays for mortgages and credit card repayments.
However, for younger customers who do not have mortgages, fees are a key concern. Although not many bank products now attract fees, there is still opportunity to help specific customers, or perhaps remind customers of the fee free nature of their products.”
The research also found that reassurances about the stability of the institution would be highly valued by all segments and in particular those aged 65 and over.
Reassurances around stability would also be more likely to be valued by customers currently unconcerned about their financial situation while fees reductions and repayment holidays are more likely to be valued by those who are more concerned about their personal situation.
“I suspect in Australia, consumers aren't as worried about their bank going under as they may be in other markets but customers still appear to want that reassurance from their bank that their money is safe.”
The research also found that a third of Australians were ‘extremely concerned’ about the impact of COVID-19 on their personal financial situation, with a further 46 per cent ‘somewhat concerned’.
The proportion of consumers ‘extremely concerned’ declined through April, suggesting that the government response to the pandemic has helped to allay concerns somewhat.
However, the decline in ‘extremely concerned’ responses has been driven by a shift to ‘somewhat concerned’ while the proportion of consumers who are ‘unconcerned’ has remained stable at around 20 per cent over the month so far.
Similar to the impact on income, the proportion of consumers concerned about the impact on their personal financial situation is higher among younger Australians
Now that the support measures are in place, RFi Group’s Wilson said banks could be well placed to continue to engage with their customers and provide additional support.