Customers switch banks at twice normal rate

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A banking industry specialist who predicted National Bank customers would change to other banks instead of transferring automatically to ANZ says the number who have has surprised her.

Wednesday, March 27th 2013, 6:00AM 2 Comments

by Susan Edmunds

Roy Morgan Research shows that of the customers who switched from National Bank only about 60% went to ANZ.

Banks were open about their desire to capture National Bank customers when the demise of the brand was announced.

Kiwibank promoted stressfree switching and Westpac ran its “seeing red” campaign aimed at National Bank customers.

Kiwibank captured 6% of National Bank’s lost customers, as did Westpac. ASB took 9% and BNZ 4%.

One in 10 customers across all banks had switched their main financial institution in the previous 12 months, almost twice the 5.9% who switched the year before.

Claire Matthews of the Centre for Banking Studies at Massey University said 5% per year was about the normal rate.

She said it was likely customers had been driven to switch by the discussion and advertising around how easy it was.

“The National Bank move raised awareness which led to others switching, too.”

Pip Elliot, Roy Morgan Research’s general manager said many customers only switched banks when they came to a “moment of truth” such as a mortgage renewal.

“2012 saw a dramatic increase in switching activity, due in large part to ramped up campaigning by all major banks following ANZ’s dissolution of the National Bank brand.”

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