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Chase UK has topped a league table of retail banks, marking the fifth successive year that digital banks have outperformed Britain’s traditional providers on customer satisfaction.
Chase, a division of US bank JPMorganChase, rose two places in the latest ranking of Britain’s 17 largest personal current account providers, which is commissioned by the UK’s Competition and Markets Authority and conducted by polling agency Ipsos every six months.
Eighty-one per cent of the bank’s customers said they would recommend it on overall service quality, up 3 percentage points from August last year and one point above Monzo, the digital bank that has consistently topped the table since August 2020.
HSBC, one of the UK’s largest high street banks, was ranked 12th out of 17 in the Ipsos poll, with only 57 per cent of its customers saying they would recommend it to peers. Royal Bank of Scotland ranked lowest on the league table with 46 per cent of customers surveyed happy to refer the bank to others.
“Time and again, bank customer satisfaction surveys throw up one key message: traditional high street banks continue to be outflanked by their digital counterparts,” said Reena Sewraz of consumer group Which?.
She said that customers who were unhappy with their current provider and had no need to visit a bank branch “might find they’ll be treated better elsewhere.”
Ipsos’s twice yearly survey asks samples of roughly 1,000 customers from each bank whether they would recommend their provider to friends and family.
Respondents are asked to rate overall service, online and mobile provision, branch services and overdraft provision. Data is collected on a 12-month rolling basis and only banks with more than 150,000 active personal current accounts in Great Britain can participate.
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Nationwide was the highest ranked of Britain’s traditional providers, with 69 per cent of users saying they would recommend it. The building society has promised to retain most of its physical branches at least until the beginning of 2028 and last year acquired competitor Virgin Money for £2.9bn.
Nationwide faces a challenge in revitalising Virgin Money and boosting its customer services.
Virgin was ranked second last in Ipsos’s league table with only 49 per cent of its customers saying they would recommend the bank’s services. Last month, the bank’s AI-powered chatbot rebuked a customer for using the word “virgin” in a query.
Digital retail banks first emerged in the UK a decade ago, challenging incumbents with a smartphone-focused offering and venture capital backing that allowed them to build scale rapidly.
Neobanks — including Monzo, Revolut and Starling — shunned a physical footprint and offered younger tech-savvy customers features such as bill-splitting, budgeting and free foreign currency transactions.
33of the UK’s parliamentary constituencies could be without a bank branch by the end of 2024, according to Which? estimates
High street banks have responded by improving their own digital provision and shutting unprofitable bricks-and-mortar branches. Lloyds Banking Group announced in January that it would close 136 branches across the UK.
Consumer group Which? estimated in September that 33 of the UK’s 650 parliamentary constituencies — with a combined population of 3mn — would be left without a single bank branch by the end of 2024.
However, more than seven in 10 UK adults continue to use cash at least once a fortnight, according to ATM network provider Link.
Consumer groups warn that branch closures risk excluding elderly Britons from banking services. The government has sought to address the problem by establishing new “banking hubs” to provide face-to-face high street services.
JPMorgan, the US’s largest bank by assets, previously avoided opening foreign retail banks because of the cost of building physical branches. But after the success of the digital-only Chase UK — its first foray into retail banking abroad — the bank is set to launch retail arms in Europe, starting in Germany.
Chase has fewer customers than Revolut and Monzo, the two largest digital banks with about 10mn customers apiece, but it has attracted wealthier customers with its savings products and Nutmeg investment platform.
Last week, Chase announced it would reduce gross annual rates on its saver account from 3.45 per cent to 2.96 per cent between February 13 and February 19, one of the largest cuts in savings rates since the Bank of England reduced the policy rate at the start of February.
Data visualisation by Martin Stabe
