Faced with falling customer sentiment, Australian banks are becoming more proactive about keeping in touch with their business customers according to East & Partners' 'Business Banking Sentiment Index'.
However, smaller businesses are still not responding well to banks' increased overtures toward them, the study found. The Index shows that Australian banks are increasingly interacting with their business customers, as 55.4% of the businesses questioned said they had direct contact with their bank during the past month. This figure has increased steadily since June 2006, when less than 30% of businesses were in contact with their bank.
Proactive approaches
The index found that banks are becoming more proactive when it comes to initiating these dialogues with customers. Overall, more than two-thirds of customers who were in contact with their bank in February 2007 said their bank initiated the contact. But this figure varied markedly among customers of different banks.
Contact rates
During February 2007, BankWest and Westpac customers were most likely to get a call from their bankers, as these banks initiated 84.2% and 83.1% of all contacts with customers respectively.
HSBC, National Australia Bank, and ANZ customers also reported that their banks took the initiative in contacting them proactively, with 78.6%, 72.6% and 63.3% of contacts respectively originating from the bank.
In contrast to the rest of the market and the other 'big four' banks, 94.4% of Commonwealth Bank of Australia customers said they had to initiate contact with their bank themselves. Only 20.2% of CBA customers said they had been in contact with their bank, compared to the market average of 55.4%.
Size bias
Despite the improvement in bank to customer interaction, much of the banks' proactivity has been targeted at larger customers, with smaller businesses being less likely to gain active attention from their bank.
Only 33.9% of 'micro businesses' (Aus$1-5 million in annual turnover) and 43.1% of SMEs (Aus$5-20 million in annual turnover) were in contact with their bank during February 2007, compared to 94.7% of 'lower commercial' enterprises (Aus$20-100 million in annual turnover).
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