Big Four Banks Lift Game on Financial Hardship

A new Rank-the-Banks survey of financial counsellors assessing how well banks are dealing with customers in financial hardship has revealed improvements across the board.

The survey questioned financial counsellors who were community-based professionals providing information, support and advocacy for people in financial difficulty.

“We are really encouraged by the survey results,”  Executive Director of Financial Counselling Australia Fiona Guthrie said. “They indicate just how far the banking industry has come in the past few years."

Financial counsellors were asked to rank each of the big four banks in terms of their hardship policies and practices on a scale of one to 10 (with one being the lowest ranking and 10 the highest ranking). There are around 950 full-time and part-time financial counsellors working with welfare agencies across Australia. FAC says more than 370 counsellors took part in the survey.

The rankings for the 2014-15 survey (with the 2013 results in brackets were): Westpac 7.0 (5.0), NAB 6.7 (6.2), ANZ 6.4 (5.9) and CBA 5.3 (4.4).

Westpac received the highest ranking and was also the bank that financial counsellors said was the most improved.  

“Westpac’s improved result in this survey was not a surprise. Westpac has engaged extensively with financial counsellors and made a number of changes over the past couple of years that are demonstrably making a difference. These include dealing effectively with customers with unrecoverable debt and their ‘get it right first time’ policy,” Guthrie said.

NAB and ANZ were ranked second and third respectively.

“ANZ had been the most improved bank in the 2013 survey and in this survey also scored highly on this attribute. CBA received the lowest ranking, which was also the case in the 2013 survey.”

“Financial counsellors and the banking industry have worked collaboratively over the past few years to improve hardship policies and practices,” Guthrie said.

“The industry has made a number of changes including investing in staff training, streamlining approval processes, reducing documentation and improving information about hardship assistance on websites. These changes are paying off.

"There is still some work to do with the smaller banks, but the trend is definitely in the right direction.”

The survey also asked financial counsellors to rate the big four banks on a number of other factors including, communication, attitude toward clients and financial counsellors, consistency and outcomes.

The survey found that Westpac, ANZ and NAB all received similar ratings. CBA’s results were much lower on all factors.

“The one area of concern was for the question relating to ‘self advocacy’. The majority of financial counsellors believe that self-advocating customers will ‘not often’ achieve the same outcomes as if they had been assisted by a financial counsellor,” Guthrie said.

Financial counsellors also commonly deal with Citibank and GE. On a scale of one to 10, GE’s rating was essentially unchanged between the 2013 and 2014-15 surveys (5.6 vs 5.7) but the ranking for Citibank shows a large improvement from 3.5 to 5.4.

The ratings for the other banks were: AMP Bank 5.0 (3.7), Bank of Queensland 5.1 (3.9), Bendigo and Adelaide Bank 5.4 (4.3), Bankwest 4.5 (4.1), HSBC 4.7 (4.0), ING Direct 4.4 (3.6), Macquarie 3.8 (3.1), Members Equity Bank 4.5 (4.3), MyState 3.8 (not rated in 2013) and Suncorp 4.9 (3.9).

The Rank the Banks report can be found HERE