Consumer Trust In Financial Services Case Study

Introduction:
Consumer trust in the financial services industry is at its lowest point. There are various reasons for this mistrust. Consumer faith in financial institutions has been low for years. The financial crisis of 2007 badly damaged the reputation of the banking sector. Consumer surveys are consistently finding that the financial services industry is one of the least trusted sectors.
Banking:
Banks are financial intermediaries. Their role is to collect and transfer funds. They should promote or enable efficient transfer of resources. Risk in banking is systemic as all banks lend to each other (daily, monthly, etc.). If bank A fails, then bank B doesn’t get its money back, then B struggles to pay C etc. This leads to everyone becoming

Preferably, financial education should be thought briefly at primary school level and perhaps in more detail at secondary school level. There are a vast number of individuals uneducated when it comes to the handling of money. Financial contracts such as ‘Personal Contract Plans’ when buying cars are a great example of consumers not aware of what they are getting themselves into. Companies trick the consumer into thinking they can afford the brand-new car. People read the slogans such as ‘only €250 a month’ and they think this plan is worth investing in. However, many people don’t realise that it isn’t as simple as that and that there is depreciation associated, APR, a deposit at the beginning and another large payment at the end. People often don’t read the small

It is also important to communicate clearly and persuasively how the bank is improving itself to fix the problems. When seen to be genuine, these are powerful acts that signal the organisation has ‘learnt its lesson’ and ‘is putting things back in order.
It’s almost 10 years after the financial crash and yet there remains a problem with trust between the consumer and the financial services industry. Although that lack of trust is decreasing as the years go by, it is still there. The question we need to ask ourselves as consumers is – how much do we trust each institution to do what is right? Without trust, the system fails. What do financial institutions need to do to prevent failure? Financial services must actively build trust. They must: communicate with a human voice, use two-way communication, solve real problems with tech, enforce transparency.
It’s hard to trust a faceless company. People prefer a more human, personalised component to their business transactions. They don’t want to feel like just another faceless member of the crowd being pitched to. They want to adopt a relationship through the human side of business dealings. Financial institutions should personalise all emails from everything. Send emails from a named address, not from a generic business email address. Personalise other marketing materials based on consumer