Credit unions saw a sharp rebound in the percentage of members who say there are "very satisfied" with their CU relationship, according to the just-released American Banker/Gallup 2004 Consumer Survey. Both banks and thrifts also saw improvements over 2003, when consumer satisfaction plunged for all institutions, although the increases were not as large.
Seventy-three percent of credit union members described themselves as "very satisfied," up from last year's 63%. Fifty-eight percent of bank customers were very satisfied (up from 54%), while 59% of thrift customers were similarly satisfied (up from 55%). The percentage of credit union members who are very satisfied remains well below the near-80% "very satisfied" rating in a number of earlier surveys. As a result of the increases across the board, overall, 61% of consumers said they were "very satisfied" with their financial institution.
This year marks the 20th consecutive American Banker survey in which credit unions were rated more highly than banks and thrifts.
"Given the sharp focus and commitment on service to their members, it is not surprising that credit unions have posted such a sharp upturn in consumer satisfaction-perhaps driven by credit unions' determination to correct the recent brief decline in such scores," said CUNA CEO Dan Mica in a released statement. "What is most important, I believe, is that for the 20 consecutive years that this report has been published by American Banker, credit unions have never been anything other than in first place in consumer satisfaction. This dramatic upturn is just icing on the cake of a two-decade record of excellence."
Charles B. Wendel, president of Financial Institutions Consulting, Inc., New York, told the American Banker it's uncertain why all financial institutions saw their ratings tank last year.
For credit unions, Wendel suggested the decrease in satisfaction may be related to larger credit unions becoming more bureaucratic and like banks.
For all financial institutions, the tidal wave of mortgage refinancings during 2003 and resulting service decreases was often blamed.
The same analyst attributed the improvement at banks to the institutions becoming more "customer-centric" and focusing on improvements in service.
When it comes to the important interest of trust in financial institutions, the American Banker survey found that consumers still trust banks more than other types of financial institutions. Thirty-two percent of members said they trust banks more than their own credit union; 46% said the two were equally trustworthy, and 19% said banks were less trustworthy than credit unions. Those figures are an improvement over 2003, when 38% of credit union members said banks were more trustworthy and 42% said the two were equally trustworthy.
Credit unions did not fare as well when consumers were asked which type of financial insittuiotn they believe will play the largest part in helping them to reach their long-term financial goals. Banks were mentioned most often at 42%, followed by mutual fund companies (26%), brokerages 17% and insurance companies (5%). The sequence was similar in 2003.
