Banks report improved customer experience in 2024 – KPMG

The Nigerian banking industry has made strides in customer experience across key segments in 2024, with notable improvements in corporate and SME banking, according to a KPMG report.

This was revealed in its 2024 Banking Industry Customer Experience Survey, which was released recently. It stated however that despite the improvement, challenges remain, particularly in the retail banking sector, where traditional banks are struggling to differentiate their offerings amid stiff competition from fintech players.

It said, “The corporate banking segment emerged as the highest-rated for overall customer experience, GTBank reclaimed the top spot for the first time in seven years, thanks to faster resolution of account issues and improved client relationships.”

“Zenith Bank and Access Bank tied for second place, receiving accolades for their proactive client support during economic challenges. UBA and Citibank rounded out the top five, showcasing their resilience in a competitive environment,” it said.

The report, which is the second edition of KPMG’s West Africa customer research publication, presents insights from over 33,000 retail customers, 5,000 SMEs, and 700 commercial/corporate organisations across Nigeria and Ghana.

It added that in Nigeria, heightened inflation and persistent currency instability have intensified the demand for efficient and reliable digital banking solutions. Following last year’s cash shortages and ATM withdrawal limits, customers are turning to digital channels more frequently, with a corresponding rise in airtime and data expenditures.

The Multinational Bank report stated that the SME segment recorded the highest growth in customer experience, with a five-percentage-point increase over last year. Stanbic IBTC retained its leadership position in this segment by excelling in personalisation, a pillar where many banks struggle. UBA and Wema Bank tied for second place, with UBA making significant gains in digital platform usability and relationship management.

Despite these achievements, personalisation remains the weakest-performing experience pillar across the SME sector. Banks continue to face challenges in delivering value-added services that address the unique needs of small businesses.

In retail banking, improvements were marginal, driven primarily by the rise of fintechs like PalmPay, Opay, and Moniepoint.

“These digital-first players have consistently outperformed traditional banks in offering seamless digital experiences, instant payments, and superior transaction services. In contrast, traditional banks have struggled to innovate, with retail customer satisfaction falling more than two percentage points compared to last year,” it said.

Stanbic IBTC retained its top spot in the retail segment for the fourth year as enhancements in mobile app features and strong security measures boosted growth. However, a nearly 3-percentage-point decline in its customer experience score points to areas for improvement, particularly in-app reliability. FCMB and UBA ranked second and third, respectively, with FCMB praised for efficient transaction processing and UBA for its effective chatbot.

However, KPMG said across all segments, securing account information and transactions remained the most critical satisfaction driver, underscoring the growing importance of digital services.

“Empathy emerged as the highest-rated pillar for retail and corporate customers, while personalisation continued to rank as the weakest. This so-called “personalisation paradox” highlights customers’ perception of generic services marketed as tailored.”

“Resolution, a perennial weak spot, showed notable improvement across the industry. Retail customers experienced better call center professionalism and faster social media responses, while SME clients benefited from enhanced POS-related support. However, these gains have raised customer expectations, intensifying pressure on banks to deliver even higher standards,” the report added.

The report added that the macroeconomic landscape in Ghana and Nigeria has shown little improvement over the past year, continuing to impact both individual and business customers, with eroding purchasing power and struggling businesses characterising the operating environment.

“In Ghana, the second year of the ongoing debt restructuring programme continues to influence economic stability and customer behaviours. In a continuing trend from last year, macroeconomic pressures have constrained real income and spending patterns, keeping the focus on savings and investments.

“Positively, the banking industry recorded an improvement in the Empathy pillar, demonstrating a better understanding of customer needs compared to last year,” it said.