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As your financial needs become increasingly complex, you may find your bank isn't paying you enough attention.
Blogger: Marie Mortimer, managing director, loans.com.au
If you’re aged between 25 and 34 and you bank with one of the big four, chances are your bank is giving you the blues. Now that the complexities of your finances are ramping up the cracks may be starting to appear and it’s time to explore your money management options.
Research from RFi shows people in their late teens overwhelmingly bank with one of the big four. This is probably due to school banking programs that got them started or even payroll requirements of large scale employers like fast-food restaurants and supermarket chains that account for many a part-time job.
These arrangements are perfectly satisfactory when all you need from your bank is a savings account for your pay to go into, and a debit card. Banks can take a set and forget attitude to these customer requirements because they are so straightforward.
But as you get closer to 30 than 20 your financial requirements become increasingly sophisticated – career, travel, family, and major purchases like a car and a first home. You might be showing serious foresight and establishing some investments or setting up a business.
It is during this phase of life that many people seek out new ways to manage their money. As their expectations of flexibility and functionality increase they encounter what researchers referred to as “service failures that have not been an issue previously”.
In short, the life events that happen during this period leave bank customers shopping around for financial products. We call this the Drop Zone – it’s when young people drop their bank because they realise their needs aren’t being met.
Traditionally, big banks have not done a good job of communicating with customers in this age group; they do not feel engaged in branches and are discouraged by admin-heavy processes.
This is why former bank customers are migrating their financial management to modern, agile lenders with sophisticated online functionality, relevant products, and competitive rates. They are informed consumers who are becoming increasingly aware that it’s a buyer’s market when it comes to banking products.
If your bank leaves you feeling strangely dissatisfied, take a look around. You might just be in the Drop Zone.