A bi-monthly index has indicated that the small business sector is dissatisfied with the level of service provided by the ‘Big Four’ banks.
Commonwealth, ANZ, Westpac and National Australia Bank, were all rated poorly by the 6,000 businesses surveyed by East & Partners.
The East & Partners’ Business Banking Index (BBI) stands to rate banks across four main criteria, aggregating customer ratings in terms of empathy, satisfaction, loyalty and advocacy.
Out of the ten banks ranked in the index, Bank of Queensland (BOQ) was rated the best, followed by HSBC, St George and NAB, the top ranked of the Big Four.
While BOQ has improved its score, the average score has come down significantly in the last few years, and especially since the GFC.
The five year comparison since the GFC also shows how relations between micro businesses and their banks have deteriorated. In the period since 2008, micro businesses turning over between $1-5 million gave their banks a collective score of 21.0 out of 100, but this has now almost halved to 11.4.
Demand for business services from the total market has also fallen sharply in the last five years.
In 2008, the index revealed that that businesses were anticipating a 38.5 per cent increase in their demand for business banking services, but this has now slipped to a new low of 17.2 per cent.
Lachlan Colquhoun of East & Partners said the new results are a stark illustration of how relationships between businesses – particularly smaller businesses – and their banks had deteriorated in the post-GFC period. “Five years at the top of the BBI is an endorsement of the relationship model being pursued by BOQ, but shows there is a major gap between the Big Four and their customers,” he said.
BOQ’s Group Executive, Business Banking, Brendan White said BOQ prided itself on its qualities as a relationship bank. “Our Owner-Manager franchise model differentiates us from our competitors because being small businesses they understand small business,” he said.