The big four will have to tread carefully as COVID-19 accelerates the digital transformation and loan and stimulus support is unwound.
Increasing digitisation of services and the removal of government stimulus measures will test the big four banks as they struggle to turn their reputations around in the wake of the royal commission, according to Accenture.
“Australian banks have made progress rebuilding consumer trust since the Royal Commission into banking misconduct. But these efforts are facing another major test, as the rapid and abrupt shift to digital banking interaction during the pandemic is threatening the relationship and trust banks have worked to rebuild,” said Alex Trott, financial services partner at Accenture.
“While banks have viewed broader digital adoption as a way to lower costs and remain accessible, Australian banks face a crucial juncture heading into 2021 as consumers will seek more empathy and assistance as Government COVID support is withdrawn. Banks who can balance their commercial needs with human connection to their customers will be better off.”
However, despite the reputational damage of the royal commission, many Australians are still happy to get financial advice from their bank, with 64 per cent believing that their bank has their best interests in mind “always” or “most of the time” and 72 per cent believing that the advice provided is “smart, personalised, and well-informed”.
However, less than one-third (29 per cent) of Australians trust banks “a lot” to look after their long-term financial wellbeing compared with 43 per cent two years ago, while many distrusted the possibility of receiving financial advice through digital channels.
“Digitisation has removed ‘humanity’ from certain banking interactions where consumers are comfortable doing by themselves. These are fine, but the human element is still critical when customers need that support and current operating models just aren’t built to maintain and deepen these relationships,” Mr Trott said.