TROY, Mich.— In what likely won’t come as a big surprise to financial services providers, the new J.D. Power 2024 U.S. Consumer Lending Satisfaction Study has found customer satisfaction with consumer loans is highest among those with the highest levels of financial health and significantly lower among those who are overextended or financially vulnerable.
The findings are being released at the same time the company noted 73% of consumer loan customers are now categorized as financially unhealthy, up from 67% in 2023.
“Lenders have their work cut out for them delivering products that meet customer needs in a persistently high interest rate environment,” J.D. Power said.
‘A Tough Proposition’
“Consumer loans are primarily used to consolidate higher-cost debts at a lower rate, but that’s a tough proposition when interest rates have remained so high for so long,” said Bruce Gehrke, senior director of wealth and lending intelligence at J.D. Power. “As a result, we’re seeing significantly lower levels of customer satisfaction among those who are most at-risk financially and arguably could benefit most from products that help them consolidate or reduce debts.”
The Findings
Among the findings in the survey:
- Returning to same lender correlated with financial health and satisfaction: “More than three-fourths (79%) of customers who are financially healthy are likely to return for their next loan vs. only 55% of financially unhealthy customers,” J.D. Power reported. “Overall satisfaction for financially healthy customers is 797 (on a 1,000-point scale) vs. 668 for unhealthy customers. However, financially unhealthy customers are more likely to need another loan and are a crucial source of new business. By delivering an experience that drives increased satisfaction for unhealthy customers, lenders will greatly increase their chances of continuing business.”
- Satisfaction higher for customers with multiple products. “On average, overall customer satisfaction scores are 68 points higher when consumer loan customers have multiple products, such as credit cards, savings accounts and other types of loans,” the company said. “However, the type of product does matter to the overall impression of the lender's brand. Credit card customers see the lender as more profit focused whereas customers with other loans and accounts view the lender as more customer focused.”
- Data security is critical for delivering high satisfaction. “On average, overall customer satisfaction scores are 176 points higher when consumer loan customers believe that their lender has a secure lending process that protects their personal information.”
Study Rankings
According to J.D. Power, American Express ranks highest among personal loan lenders in overall customer satisfaction for a second consecutive year, with a score of 781. Discover (742) ranks second and Citi (730) ranks third.
J.D. Power further said the U.S. Consumer Lending Satisfaction Study was redesigned for 2024. It measures overall customer satisfaction based on performance in seven core dimensions on a poor-to-perfect rating scale. Individual dimensions measured are (in order of importance): loan met borrowing needs; level of trust; experience obtaining loan; makes it easy to do business with; people; digital channels; and kept informed about loan. The study is based on responses from 4,387 personal loan customers and was fielded from January through March 2024.
Additional information is available here.
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