State-owned banks named worst for customer service

Published on Wednesday 18 August 2010 16:25

TAXPAYER-backed Bank of Scotland has come bottom of the league for customer service in a survey that found the UK's biggest banks continue to frustrate their customers.

The annual round-up of the customer satisfaction surveys carried out by consumer group Which?, published today, reveals that Lloyds Banking Group brands occupy three of the bottom five places in its ranking of customer service levels.

Its research singles out the best and worst brands in four banking areas - current accounts, savings, credit cards and mortgages - according to surveys of Which? members. The top half of the table is dominated by the smaller brands in the sector, while the five biggest brands all were all in the bottom ten out of 31 banking brands.

HSBC-owned First Direct came out on top overall after ranking first for current accounts, savings and mortgages, giving it an overall satisfaction score of 81 per cent, said Which?. One Account, the current account mortgage specialist, was second and internet bank Smile came third. There were three building societies in the top ten, including Nationwide and Coventry.

The table was propped up by Bank of Scotland, which recorded a score of just 43 per cent, compared with an average of 59 per cent. Just above it was Halifax, also part of taxpayer-supported Lloyds Banking Group, and Santander - which owns Abbey, Alliance & Leicester and Bradford & Bingley's savings operation - was third from bottom. RBS was 25th with an overall customer satisfaction score of 53 per cent, while Barclays and Lloyds TSB were 22nd and 23rd respectively.

Peter Vicary-Smith, chief executive of Which?, said: "Time and again, the big high street banks are found to be lacking when it comes to good customer service. People who are unhappy with their bank must vote with their feet and move to a better financial provider."

Despite widespread dissatisfaction with the UK's high street banks most bank customers remain reluctant to switch to a different brand. Research published yesterday by Santander found that the average Scot has held the same current account for almost 17 years. More than half of all UK adults have retained the same current account for more than a decade and a fifth for more than 30 years. The research also uncovered a small minority of "serial switchers", with 7 per cent of UK customers changing current account three or more times in the past ten years.

Ken Burnett, founder of the Change Your Bank campaign, said there were two key reasons for the low levels of current account switching. "People either accept the rhetoric from the political parties and believe that something will be done, or they don't believe that this aspect of the system will ever change. They feel that the banks have always shafted the ordinary people."I don't accept either of these beliefs, but only a very small minority appear willing to make a stand and to do anything tangible to oppose the banks, beyond being upset."