The financial services industry clearly has an image problem. Large swathes of the population have lost trust in the sector generally, and the banks in particular.
This happened because the recession was triggered by the credit crunch, which, rightly or wrongly, the banks are widely believed to have caused. Further, it is commonly held that the banks (and by association financial services more generally) have let us down, we bailed them out and we are paying the price.
This is a huge change in perception for a sector that has traditionally been the by-word for dependability; but now the following comment on TellYouGov is typical of what consumers are saying:
“I no longer trust the finance industry, banks, building societies, investment brokers. After the recent problems I believe the whole industry is corrupt and I would probably be safer keeping my savings under the mattress.”
The ramifications of this should not be underestimated. As once trust can no longer be taken for granted then the relationship between the provider and its customers is threatened. Research conducted by YouGov’s financial services team illustrates how much things have changed:
- 54% trust banks less than they did at the start of the economic downturn.
- 47% are now less likely to invest in funds.
- Compared to two years ago, three times more people are unsure whether they are making adequate provision for retirement.
In other words the climate of uncertainty and mistrust has led to attitudes forming which, if not checked, could have damaging implications for the way in which people manage their finances.
To find a way through this, financial services providers must understand:
- Their levels of trust compared with the industry as a whole and the new, more trusted, entrants.
- What impact any activity they undertake has on the trust which consumers have in them.
- The language and actions which will allay the deeply held concerns of consumers.
Descartes put it eloquently: “It is prudent never to trust wholly those who have deceived us even once”. The financial services industry needs to understand this quickly and prove, through its actions, what it has learned.