Striking a balance between digital and traditional delivery channels


Frans Stander | General Manager | Marketing and Business Development | South African Customer Satisfaction Index (SA-csi) | mail me

The relentless drive towards digital banking is making banks ‘invisible’, leaving customers looking for more value, human engagement and diversity of transactional channels according to the South African Customer Satisfaction Index (SA-csi) for banking.

Digital and online banking channels are no longer the key differentiators that they were a few years ago as trends indicate that all the major players in the industry are moving to a point of technological parity in so far as their transactional channels are concerned.

Customers are placing far more emphasis on perceived value and the need for banks to retain a human touch.

In order to compete successfully banks will need to continue innovating in the digital space, but also introduce equally innovative service delivery models within their more traditional channels such as branches, ATMs and contact centres.

Investments in the digitisation

After a tumultuous last two years which saw significant jockeying for position, huge investments in the digitisation of customer touch-points  and the entry of new disruptor digital banks, the key players in the banking sector need to consolidate their positions by reconnecting with their customers.

This is according to the 2019 SA-csi for banking conducted by Consulta, providing highly scientific insights into the overall level of satisfaction of customers of South Africa’s top retail banks.

Consulta polled almost 15,000 customers from lower, middle and upper retail banking segments on their overall level of satisfaction with South Africa’s big six retail banks – Absa, African Bank, Capitec, FNB, Nedbank, and Standard Bank.

The SA-csi for banking is one of the most robust surveys with a sample size of almost 15,000, making it the gold standard in terms of scientific research into the banking sector.

It utilises a causal model that links customer expectations, perceived quality, and perceived value to customer satisfaction (the SA-csi score), which in turn is linked to customer complaints (and recovery), and customer loyalty intentions as outcomes.

Striking a balance between digital and traditional delivery channels

For the first time since the inception of the SA-csi for banking, Nedbank has caught up to FNB, with the former managing to outscore FNB in perceived value specifically.

African Bank, Capitec, FNB and Nedbank all hold leader positions. Each of these banks hold a particular, unique and strong position in the minds of customers. African Bank achieved a seven-point improvement from its 2018 score.

This puts African Bank into a leadership position with the afore-mentioned banks, albeit with a smaller, but growing client base. African Bank is making a statement that can hardly be ignored.

Absa, who is rebuilding its brand of trust and confidence, remained stable. This is a notable achievement as the bank was in the process of cutting its final ties to Barclays – a process that they successfully concluded without causing any significant disruptions to its customers.

Standard Bank had a particularly tough time, struggling to keep up with the competition on customer satisfaction. Hopefully Standard Bank will start to experience an upward trend in their customer satisfaction metrics once significant chances in the organisation has been implemented.

It is pertinent to point out that while South Africa’s banking sector is world-class in customer satisfaction, expectations remain extremely high and are likely to keep rising.

Going forward, banks will need to better understand the nature of these expectations which includes striking a balance between digital convenience, value delivery and human intuition and engagement.

Key take-outs from the SA-csi for Banking 2019

Overall customer satisfaction score
  • African Bank performs at a high score of 85.7. This is a seven-point improvement from the 2018 SA-csi.
  • Capitec (84,0) followed by Nedbank (80.2) and FNB (79.9) – all in leader positions and above the industry average (78.2).
  • While Capitec maintains a leader position off a very high base, it is showing signs of decline, which points to the challenges of maintaining customer satisfaction levels when expectations are on the rise. While Capitec still has real substance to its value proposition, it needs to note the marginal decline in year-on-year scores.
  • Nedbank has made consistent improvements over the last five years achieving a score marginally better than FNB in 2019.  Nedbank comes in at 80.2 followed closely by FNB with 79.9 – both also in leader positions.
  • Absa (76.8), although showing slight improvement on its 2018 score, comes in below par, followed by Standard Bank (75.3), who declined on its 2018 score.
  • Absa remains stable, with a point five index point improvement from the 2018 score, but remains four points higher than the low-point of 73 in 2017.
  • Nedbank has shown strong consistent improvement. Focusing on its positioning, pricing, messaging and customer facing channels is starting to pay dividends, particularly in the middle and upper market segments.
  • After years of decline, Absa shows consistent improvement but will need to work hard to ensure that actual deliverables meet customer expectations in order to maintain their upward trend.
  • Standard Bank continues to struggle with its value proposition to clients and has remained below par on overall customer satisfaction since the inception of the index eight years ago. Its score declined by almost two index points in 2019 after showing some improvement in 2018.
Customer expectations and perceived quality
  • Customer expectations within the banking industry continue to rise to new highs (82.4). Expectations are based on personal needs of the consumer as well as past experiences.
  • When Customer expectations are overlaid with perceived quality scores, African Bank, Absa, Capitec, FNB and Nedbank all exceed their customer expectations, while Standard Bank has a negative gap where perceived quality does not meet expectations.
  • In terms of perceived quality, Capitec, FNB and Nedbank have consistently maintained perceived quality scores above industry par over a five-year trend.  Absa and Standard Bank have typically performed below par on perceived quality in each SA-csi measure for the past five years.
Perceived value
  • Capitec (87.8) and African Bank (85.3) are the undisputed leaders in perceived value leading by about 15 index points over the lowest scores in this category, which are Standard Bank (72.0) and Absa (72.1).
  • On perceived value, Capitec (87.8), African Bank (85.3) and Nedbank (77.7) are in leader positions, FNB (74.6) is on par, and Absa (72.1) and Standard Bank (72.0) are below par.
  • Across all sectors, Perceived Value is the most contested area in customer experience (CX) in banking – it’s not only about affordable fees, but true value for the customer.  The battlefront of perceived value will become very intensive as other banks are increasing their value to customers and in this regard being a ‘digital’ bank no longer is a sufficient differentiator. All banks now offer strong online banking and app platforms, so Perceived Value needs to come through in all other touch-points of the banking experience.
  • Objectively, having high perceived value scores does not mean that the leaders necessarily have the lowest banking fees, however it does talk to the overall quality of the experience compared with the price paid, and whether clients believe the perceived quality is worth the price paid. Customers are increasingly looking for simplicity in all aspects of their transaction interfaces – from in-branch, ATMs, online and app.
  • African Bank, Absa and Nedbank all showed improvements in perceived value scores while FNB, Capitec and Standard Bank all declined. Over a three-year period, Nedbank has shown consistent improvements in perceived value scores, while FNB has declined with almost a 3-index point drop in 2019 compared to 2018.
Complaints incidence and resolution
  • African Bank has the lowest complaint incidence (8%) and the highest complaint resolution rate, albeit off a low base.
  • Capitec comes in with a complaint incidence rate of 12,5%, one of the lowest in the industry and a high complaint resolution rate (60.7) which is in line with global benchmarks. Capitec’s low complaint incidence rate is reflective of its simple and efficient model that avoids complexity.
  • One in four customers logged complaints with their bank. It is concerning that when you delve into the reasons for complaints, these revolve around the basics such as account queries, debit orders and payments, card issues, fees and costs, rather than more complex issues (to the customer at least).
  • Absa, African Bank, Capitec and Nedbank have all improved in complaint resolution scores compared to 2018, while FNB and Standard Bank have declined.
Customer loyalty
  • This metric is based on a customer’s likelihood to choose the same provider again as well as their sensitivity to price increases or decreases.
  • Absa, African Bank and Nedbank have improved in this year’s index on customer loyalty and have also shown consistent year on year growth.
  • Capitec and FNB have both seen a decline in customer loyalty scores, however the decline is consistent over a three-year period which could suggest a level of complacency that warrants attention.
  • It is noteworthy that while FNB has always been strongly positioned as the ‘digitally differentiated’ bank, their customer loyalty score has decline for a third successive year.
  • Absa and Standard Bank have the lowest customer loyalty scores and are below industry average.
Net promoter score
  • NPS measures the likelihood of a person to recommend a brand to friends, family or colleagues.
  • African Bank (62.8%) and Capitec (57.5%) have the highest Net Promoter Score (NPS) with both banks’ scores double the industry average of 29.6%. African Bank has 72% promoters (very likely to recommend) and Capitec 68% promoters.
  • FNB (40%) and Nedbank (38.1%) follow in second and third place respectively. Both are also well above the industry average.
  • Absa (19.4%) and Standard Bank (19.1%) trail far behind and well under par. Both banks have the highest number of detractors at 27%.
Treating customers fairly
  • The degree to which customers feel they are being treated fairly by their banks is highest with African Bank, Capitec and Nedbank.
  • It is lowest with Standard Bank and Absa.

The SA-csi is a strategic tool for gauging the competitiveness of individual firms and predicting future profitability through measuring customer satisfaction performance.

Supported by both the scientific and practitioner community, the SA-csi is the first independent, comprehensive national customer satisfaction index with international comparability in South Africa and has collected data from more than 400,000 consumers since its inception in 2012.

The SA-csi forms part of a global network of research groups, quality associations and universities that have adopted the methodology of the American Customer Satisfaction Index (ACSI) via its Global CSISM program.



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