Small Business Banking Customer Satisfaction Rebounds as Big and Midsize Banks Surpass Regional Banks
Chase Ranks Highest in Customer Satisfaction in the West and Northeast Regions; Huntington National Bank Ranks Highest in the Midwest Region; and Regions Bank Ranks Highest in the South Region
WESTLAKE VILLAGE, Calif.: 30 October 2014 — Overall satisfaction among small business banking customers rebounds from last year as big banks and midsize banks show strong improvement, while satisfaction for regional banks remains flat, according to the J.D. Power 2014 U.S. Small Business Banking Satisfaction Study.SM
The study, now in its ninth year, measures small business customer satisfaction with the overall banking experience by examining eight factors: product offerings; account manager; facility; account information; problem resolution; credit services; fees; and channel activities. Satisfaction is calculated on a 1,000-point scale.
In 2014, regional banks are losing ground and may be stuck in the middle as big and midsize banks have built on their respective strengths. Big banks continue to lead in offering large networks of branches and ATMs, along with easy self-service options, while increasing their focus in providing personal service. Midsize banks continue to excel in personal service and offering low fees and have become more competitive in the technology they offer their customers.
The strategies used by big and midsize banks have paid off by achieving higher satisfaction scores among small-business customers. Customer satisfaction with big banks is up 19 points, to 768 from 749; and satisfaction with midsize banks is up 18 points to 780 in 2014 from 762 in 2013. Satisfaction for regional banks has improved by 4 points to 758 in 2014, up from 754 in 2013. Big banks and midsize banks surpass regional banks by 10 and 22 points, respectively.
“Until now, many regional banks have positioned themselves as having the best of all worlds, with the products, convenience and technology of the big banks and the personalized service of smaller banks,” said Jim Miller, director of banking services at J.D. Power. “While some regional banks remain successful at this, overall the regional banks have lost their lead over big banks in personal service while smaller competitors have passed regional banks in convenience and satisfaction with product offerings. To remain competitive, regional banks will have to develop value propositions that differentiate themselves from their larger and smaller competitors and then flawlessly execute their plans.”
- Overall satisfaction among small business banking customers is 766, up 14 points from 752 in 2013.
- Big banks and midsize banks now lead regional banks in all factors.
- Big banks excel at offering convenience; and lead in facility with longer hours and more locations, website, ATM, automated phone and mobile.
- Midsize banks lead in fee satisfaction and credit services as well as in customer service relationship building with account managers and in-person transactions.
- Problem incidence is highest at regional banks at 24 percent (down 1 percentage point from 2013), compared with 23 percent at big banks (down 4 percentage points) and 21 percent at midsize banks (down 2 percentage points).
- Nearly two-thirds (60%) of small-business customers with high satisfaction (overall satisfaction scores of 800 and above) say they “definitely will” recommend their bank, compared to just 11 percent of those with medium satisfaction (500 to 799) and only 2 percent with low satisfaction (less than 500).
- On average, small-business customers with high satisfaction have 6.3 business products with their primary bank, compared to 4.8 for those with medium satisfaction.
Small Business Banking Satisfaction Regional Rankings
Chase ranks highest in small business banking satisfaction in the West region for a second consecutive year and in the Northeast region, performing particularly well in product offerings; facility; account information; credit services; account manager; and channel activities.
Huntington National Bank ranks highest in small business banking satisfaction in the Midwest region and performs particularly well in facility; fees; account information; and channel activities.
Regions Bank ranks highest in the South region and performs particularly well in product offerings; account information; and channel activities.
The 2014 U.S. Small Business Banking Satisfaction Study includes responses from nearly 9,000 small-business owners or financial decision-makers who use business banking services. The study was fielded from July 2014 through September 2014.
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 Big banks are defined as the six largest financial institutions based on total deposits as reported by the FDIC, averaging $180 billion and above. Regional banks are defined as those with between $180 billion and $33 billion in deposits. Midsize banks are defined as those with between $33 billion and $2 billion in deposits.