Frustrated Small Businesses Planning to Switch from Banks
Credit unions may continue to have an edge over banks when it comes to the growing number of small business owners who say they are frustrated with their financial institution's service.
The findings come from a new Aite Group LLC report of 283 owners and executives of businesses that generate less than $10 million in annual revenue. Among small businesses that are "disappointed" with their financial institutions, 31% stated they "definitely" or "probably will" switch to a new financial institution over the next two years. Thirty-eight percent of disappointed customers bank with the "Big Four" banks, while 41% bank primarily with regional banks. The big four are Bank of America, Citigroup, JPMorgan Chase and Wells Fargo/Wachovia.
The most significant declines in satisfaction were seen in customer ratings of service, online banking application ease-of-use, and financial institutions' ability to understand the specific needs of their customers, Aite found.
Despite financial institutions' increased focus on the small business customer segment over the last few years, small businesses' overall level of satisfaction with their primary institutions decreased between 2007 and 2009, according to Aite. This is especially true among those that had described themselves as "extremely satisfied" in 2007.