YONKERS, N.Y.–Americans remain more satisfied with the credit unions and online banks than they do traditional banks–but they are generally happy with the latter, as well.
Another finding: big scandals, such as those at Wells Fargo, have little effect on the average bank customer who is unlikely to move funds as a result.
A new survey released by Consumer Reports said that its survey, which included 72,000 consumers who provided views on 148 financial institutions (69 traditional banks, 70 credit unions, and nine online banks) found the two financial institutions rated most highly were two regional banks: First Republic in San Francisco and Frost Bank in San Antonio. Others, including First National Bank of Omaha and Third Federal in Cleveland, also rated highly, Consumer Reports said.
In an overview of its findings, Consumer Reports did not cite any specific credit unions, but instead referred to overall ratings of credit unions.
“Credit unions are among the highest-rated services we’ve ever evaluated, with 96% of our members highly satisfied vs. 80% for the three biggest national banks,” Consumer Reports said. “That satisfaction is driven by good customer service, not surprising when you consider that credit unions are owned and managed by their members. Credit union members usually have access to free checking, higher interest rates on certificates of deposit, and significantly lower rates for credit card and auto loans.”
The report added, “One difficulty can be that membership eligibility is limited because credit unions are often linked to an employer or a group, such as a labor union or church. But community-based credit unions have more relaxed rules, and almost anyone is potentially eligible to join a credit union somewhere.”
Consumers were asked to rate a number of factors, such as customer service, wait times to see a teller, how easy it is to use the bank’s website and mobile app, and the convenience of hours and locations.
While the nation’s biggest banks generally scored lower than the smaller banks, respondents gave Chase a higher overall satisfaction score than they gave to Bank of America and Wells Fargo, Consumer Reports said.
“Other banking surveys, such as one from J.D. Power, also shows that many consumers appreciated Chase’s ATM and branch network, and mobile and online services, as well as the quality, clarity, and relevance on the advice provided about financial products it offers,” the publication said. “While Bank of America and Wells Fargo—which is still dealing with the aftermath of a fake-account scandal—fell behind in customer satisfaction, both say they are seeing improvements.”
Consumers gave the lowest rating to HSBC, which received poor marks for five of the six attributes Consumer Reports measured.
“Overall, our members relied more on credit unions than banks for savings accounts, credit cards issued by the financial institution, loans, CDs, and mortgages,” said Consumer Reports. “One reason is that credit unions generally charge lower interest rates on loans.”
Meanwhile, consumers also gave high ratings to online-only banks. Among the nine in this category, USAA, Schwab Bank, and Ally Bank were rated the highest in overall customer satisfaction. These three companies also provided easy-to-use online transactions and useful websites, Consumer Reports said. “Like credit unions, online banks also offer better interest rates than traditional banks.”
Noting that the Consumer Financial Protection Bureau has taken enforcement actions against more than two-dozen banks since 2012, Consumer Reports said in its analysis “it may be surprising that consumers like their banks so much.”
“But our findings suggest that the overwhelming majority of consumers overlook alleged wrongdoing on everything from mortgage redlining and illegal student loan servicing practices to charging for unauthorized overdraft protection and deceptive marketing,” the publication said. “Only 11% of our surveyed members closed an account because of concerns about their institution’s lack of social responsibility.”