AUSTIN, Texas — Two-thirds of adults in the U.S. report they would rather use a credit union or community bank instead of a big national bank.
That's the good news from the 2015 Consumer Banking Insights Study, which was commissioned by BancVue on behalf of nearly 300 community financial institutions (CFIs) offering its Kasasa brand of checking accounts and conducted online by Harris Poll in January 2015 among more than 1,000 U.S. adults (ages 18 and up).
The bad news: only 23% of consumers (defined as U.S. adults ages 18 and up who have a checking account at a financial institution) who are not currently banking at a CU or a community bank say they are at least "somewhat likely" to switch in 2015.
Consumers cited a lack of products (11%) and awareness (11%) as two reasons for not using a CFI as their primary institution.
Features such as free checking, ATM fee refunds and access to the latest banking products are more important when it comes to choosing an FI than the banking institution that provides them, according to the study.
Fully 31% of megabank customers (defined as checking account holders who consider one of the big national banks to be their primary banking institution) said they want to use a credit union or local community bank, but feel that those institutions lack the products they need.
Lack of awareness remains a hurdle, as consumers who do not have an account with a CFI said they do not use a local CU or community bank because they have not thought about it (30%) or are unaware of their options (11%).
Lack of awareness is an even bigger factor when it comes to millennials (18 to 34 year olds). Millennials who don't have an account with a CFI are more than twice as likely to say they don't use a local one because they are unaware of their options (18%), than 35-54 year olds (8%) and adults 55 and up (7%).
When it comes to products, 38% of millennials say they want to use a local community bank or credit union but are worried those institutions do not offer the products they need, such as free checking, rewards checking, loan products or financial management tools.
BancVue said the study results suggest a "major need" for stronger outreach and marketing efforts on the part of CFIs.
"The study's results make it clear that, for community financial institutions, stronger marketing efforts and better products are the key to growth," Gabe Krajicek, BancVue's CEO, said in a statement. "If community banks and credit unions offer consumers the innovative services they want, they'll switch. It's as simple as that."
