Singaporeans refuse to be loyal to a single bank

More than half distribute deposits and investments to three or more banks, says survey.

 Ernst & Young’s Global Consumer Banking Survey 2012: The customer takes control released today highlights that Singapore’s customers are demanding more value from their banking relationships.

The survey, conducted in February and March 2012 using an internet questionnaire, covered 28,560 banking customers across 35 countries, including 500from Singapore.

While the bulk (80%) of Singapore banking customers are loyal to their main banking provider, compared with only 58% across Asia-Pacific. Yet, only 15% of Singapore customers have one banking provider while 52% use three or more banks.

The main reasons for using multiple banks are to spread the deposits in case of bank failure (59%) and to ensure the best rates or fees for each banking product (45%). High fees and charges (68%) and poor interest rates on deposits (50%) are two main factors that would drive Singapore customers to change their banking providers.

Liew Nam Soon, Asia-Pacific and Singapore Financial Services Advisory Leader at Ernst & Young, says: “With the recently announced updates to the Qualifying Full Bank program, competition is expected to intensify as customers have more banking choices. While there is stability in the relationship with their primary bank provider, customers are increasingly open to use more than one bank, based on their perception of which bank provides the best product or service to meet a particular financial need, and price considerations. This is not unique to Singapore; globally there is a shift toward multi-banking relationships in matured markets with sensitivity to fees and charges being main drivers of attrition.”