- Trust in big banks is currently at the lowest level in 20 months
- Savings is on the decline but has not yet lowered to pre-pandemic levels
- Trust in small banks is higher than big banks
Australians are losing trust in their ‘Big Four‘ banks and opting for smaller alternatives, according to new data released by Finder.
Trust in big banks peaked in April 2021 at 62%. It has since declined to its lowest level in 20 months, reaching 52% in October 2021.
Senior editor of money for Finder, Sarah Megginson, explained that Aussie savers beginning to feel more comfortable placing their money with smaller banks, credit unions or even non-bank alternatives.
“There was a massive shift to ‘safety’ during the pandemic, with people flocking to established brands they could ‘trust’ with their hard-earned cash,” she said.
“But now that the immediate economic threat has passed, and consumers are more interested in innovation and returns, smaller lenders are catching a lot of customers on the way out.”
Smaller institutions have maintained a relatively high level of trust with Aussie savers. Trust in small banks was at 65% in October, only a slight decline since the 66% rate a year ago.
“Smaller lenders are innovating rapidly to compete with the bigger players and with open banking making it easier than ever to switch between different brands, consumers are not as loyal as they were in the past,” Ms Megginson added.
“The loss of trust in the big banks should hopefully lead to more people shopping around, getting a better deal and ultimately saving money.”
Sarah Megginson, Senior editor, Finder
As trust in the big banks falls, consumer saving habits have also declined.
Finder has reported that average monthly contributions to the savings account has been on the decline almost consistently throughout 2021.
Late 2020 saw the figure remain in the $800’s. This has declined since and sits at $714.45 for November 2021.
“While household savings increased dramatically during the first 12 months of the pandemic, Aussies have fallen back into old habits.
“While the monthly savings is still higher than pre-pandemic levels (around $600–$700 a month) – it does appear to be trending down,” she concluded.
