What Factors Drive Consumer Distrust In Today’s Banking Institutions?

Since the financial recession of 2008, it’s been revealed that Americans have developed a sense of distrust towards the banking industry. And rightfully so, with a reported 40% of Americans having been affected during the unfavorable 17 month period. A recent study supports claims that a wide margin of Americans feel a lack of trust towards banks, arguing that consumers are continuously turning away from traditional financial platforms, going as far as stashing cash around the house.

8 years later, with the economy back on the rise, how has consumer trust been restored in the banks?
With a variety of Americans taking such extremes to protect their finances, we wanted to know more about the current conversation regarding banking and trust within the United States. Using social insights, we were able to see over the course of 2015, only 8% of consumers felt as if they could trust the banks.
Inversely, levels of consumer distrust remained high, with 45% of consumers expressing that they felt cheated by the banks, jumping 53% percentage points in 2015.  Furthermore, 38% of consumers reported a lack of transparency with their banking institutions, reporting issues such as costly fees and inconclusive customer service issues.

image1bankblogDiving further into the banking discussion, we can examine specific topics that drove major banking and trust conversations. In understanding what matters most to consumers, financial institutions can focus future strategy to generate a stronger, and more transparent relationship between bank, and consumer.
The data shows that major topics of conversation are “loans”, “credit cards”, and the “banking system” overall. Combined with the negative sentiment underlying the conversation as a whole, it is clear that these are the drivers of consumer skepticism. Social data shows that the negative conversation is focused on services and products, rather than the banks themselves. From this dataset, it’s apparent that a majority of negative conversation is not with the banks themselves, but the services and products that these institutions provide.
Brands can gain intelligence about the why behind the what by analyzing the data behind the conversation, enabling them to target more precisely their efforts at winning over consumer confidence.

In addition to analyzing the conversation, we can also analyze who is expressing these concerns:

  • Individuals 35 year or older have the loudest voice, making up 62% of the total.
  • 18 – 24 years follow with 17% of the conversation.

We extrapolate the following from this data: the majority of this audience are either those who personally experienced the worst impact of the Global Financial Crisis, or who witnessed an adult in their household who had.
In addition to demographics, through Crimson’s platform, the psychosocial profile of consumers can also be examined where audience interests can be reviewed in detail. From our Affinities chart, we can see that those engaging in the banking and trust conversation are more concerned with topics such as Investing, Finance, and Business News in comparison with the rest of Twitter. Learning more about audience interests can help brand managers and marketing executives strengthen the strategic direction of campaigns, honing in on relative interest that can bridge the gap between brand and consumer.
Using Crimson’s social analytics platform, companies within key industries, such as the financial sector can further investigate levels of trusts within consumers, parsing out what’s essential for future brand direction. While it appears that there is still a strong sense of mistrust towards the banking industry, there are certainly areas for improvement that can be fueled by social insights. When addressing consumers who may already hold a preconceived notion about the industry, banks can use social for competitive intelligence against others in the industry. In doing so, social listening can provide brands with the advantage of quickly addressing top consumer complaints, remedying those issues, and improving overall brand perception.
For more information on how brands in the financial industry can utilize social insights, we invite you to review our financial industry trend report.

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