J.D. Power and Associates' 2012 U.S. Bank Customer Switching and Acquisition Study reveals the percentage of consumers who have defected to smaller and more community-centered banks continues to rise.
According to the survey, the massive migration from large and mid-sized banks is a response from fee increases, poor customer satisfaction and failing to meet customer expectations. The number of consumers switching to community bank and credit union programs to save money on fees increased 10.3 percent so far in 2012, up 2.2 percentage points from 2011. In addition, defections from large to mid-sized banks averaged between 10 and 11.3 percent in 2011, while the same rate for those who switched from credit unions or community banks only sat at 0.9 percent.
"It is apparent that new or increased fees are the proverbial straws that break the camel's back," said J.D. Power and Associates banking services director Michael Beird. "Service experiences that fall below customer expectations are a powerful influencer that primes customers for switching once a subsequent event gives them a final reason to defect."
According to the survey, fees are the primary reason individuals shop for a new bank, while customer satisfaction and the banking experience also play a role in a consumer's decision.