Why should financial institutions focus on account holder financial wellness?

Now is the time for financial institutions to prioritize leveraging technology focused on the financial health of their account holders. Two recent surveys, highlighted below, found a gap between what account holders want — help and guidance — and what their financial institutions are delivering.

The J.D. Power 2023 U.S. Retail Banking Satisfaction Study found account holders are concerned about inflation and an uncertain economy, and it’s affecting both their financial wellness and the relationships with their primary financial institution.

The number of account holders with $10,000 or more in their primary bank declined by 16 percentage points, from 44 percent a year ago to just 28 percent now. Some 30 percent have shifted their deposits to another financial provider. Meanwhile, account holders categorized as “financially unhealthy” rose by 9 percent.

One important finding from the study: Bank customers are struggling, but advice and guidance from their primary financial institution is lacking. The study found just 21 percent of account holders have received financial wellness guidance in the past year, but — and this is key — the ones who have are “significantly more likely to have opened a new account with their primary bank.” Almost half of those who received actionable guidance from their financial institution self reported to have done so.

 

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