New J.D. Power survey shows growing concerns with Canada’s ‘big five’ banks

RBC leads the big five banks in customer satisfaction, but a new survey shows growing concern over service quality and fees. Pat Foran reports.

A new banking survey from J.D. Power is showing a growing divide between Canada’s ‘big five’ banks and smaller, mid-size institutions.

While, the big five banks dominate the financial landscape with more than 80 per cent of all customers, some smaller mid-sized banks are outperforming them, especially when it comes to customer satisfaction.

The survey found that many people are generally satisfied with their banking, but there are growing concerns about excessive fees and a lack of customer service.

Of the well-known banks, Royal Bank of Canada (RBC) was named number one in customer satisfaction for the second year in a row.

“More often than not we see RBC has the highest rate of satisfaction among the five big banks,” said Paul McAdam, senior director of banking and payments intelligence with J.D. Power.

On a thousand-point scale, RBC came number one with 611 points, followed by CIBC with 607 points, the Bank of Montreal (BMO) close behind with 606, TD Bank with 599 points, and Scotiabank with 595.

Customer satisfaction declined seven points with the big five banks over last year, but rose five points with mid-sized banks, the survey also found.

“With mid-sized banks, customer satisfaction is rising with online chat, email support, online banking and branch services, but we see some of these same things declining in satisfaction with the big five banks,” said McAdam.

In the mid-sized banks category, Tangerine took the number one spot with 683 points, followed by Simplii Financial with 644 points, National Bank of Canada just one point shy with 643, Desjardins with 640 points, and ATB Financial had 639.

J.D. Power says Tangerine has been number one in the survey for 14 consecutive years.

“Tangerine does everything well you would expect an online bank to do well with mobile apps, but they also do very well with telephone service and resolving problems,” McAdam said.

According to the survey, it found that banks both big and small are doing a better job when it comes to problem resolution, but not when it comes to opening new accounts and the helpfulness of bank employees.

The survey also revealed that seven per cent of customers switched banks last year due to poor service, high fees or promotional offers from competing banks.

Smaller banks are also seemingly doing a better job with customer service, according to the survey, whether it’s online or on the phone.

Even though the big banks dominate the industry, the numbers show they could do more to try and keep their customers happy.