Banks can do better, says FPB
The quality of service provided to businesses by banks is rising, claims Nick Goulding, chief executive of the Forum of Private Business (FPB), but there is still scope for improvement.
Goulding’s comments were made after the FPB, which represents the interests of approximately 25,000 UK-based businesses, released a biennial survey of 3,700 firms, entitled: Private Businesses & their Banks. During the past two years the standard of service in the banking sector has improved, says Goulding, ‘but comparing the performance of individual banks over the last three surveys showed significant differences’.
According to the FPB, Allied Irish Bank (AIB) retains the title of best performing business bank, despite a slip in performance from the last survey, and was joined in equal first place by Yorkshire Bank. Clydesdale Bank was third, the Royal Bank
Of Scotland came fourth, and NatWest fifth in the league table, improving on its 2004 performance index. The FPB observes that HSBC’s performance index and ranking fell, moving it down from fourth to sixth. Barclays was seventh, with an improved index and Lloyds TSB eighth, despite also recording an improved index.
While the combined performance of the banks appears to be getting better, Goulding claims businesses are becoming more inclined to change banks: ‘The past three surveys have indicated that the percentage of those businesses which were not considering changing bank has fallen from 63.8 per cent in 2002, to 58.3 per cent in 2006. This shows that firms are becoming inclined to shop around for the best deal.’
When it comes to paying fixed transaction charges, 51.9 per cent reported a perceived increase during 2006, compared to 46.1 per cent two years ago. Just over 42 per cent of firms paying negotiable transaction charges reported a perceived increase during 2006, compared to 35 per cent in 2004.
Gould warns that firms must monitor charges closely and banks have more work to do to communicate those charges. ‘If necessary, businesses must ask for charges to be reviewed or checked, and banks must make their charging processes as transparent and simple to understand as possible,’ he says.