Rights & Money

Under-40s Are Less Satisfied With Banks

The gap in customer satisfaction between Canadians under 40 and those 40-plus is growing


By Jennifer Hughs

Photo: iStock/ultramarine5.

Canadians under 40 are less satisfied with the country’s midsize and large banks than older customers, and according to a recent survey, the gap is widening.

The J.D. Power 2019 Canada Retail Banking Satisfaction Study looked at the responses of more than 15,000 customers. While satisfaction with banks rose from 785 (on a 1,000-point scale) in 2018 to 792 in 2019 among customers 40 or older, satisfaction among those under 40 fell from 780 to 777. What was a five-point difference in satisfaction in 2018 is now a 15-point gap.

Though banks are investing in convenience and digitalizing transactions to make banking easier for costumers, service quality in the areas of problem resolution, in-branch service, and both automated and live telephone service has been unable to keep up.

“Younger and digital-centric costumers are vital to future business growth, but younger customers are more likely to receive inconsistent service levels,” said Paul McAdams, senior director of banking intelligence at J.D. Power. “Banks that don‘t address the gaps in service expectations ar at an increased risk of client departures.”

The study found that younger customers are three times more likely than older customers to switch banks—9% of respondents under 40 switched to another bank during the past year, compared with only 3% among the 40-plus group.

TD Canada ranked the highest in the study among the biggest banks, with a score of 789, while RBC and BMO received scores of 784 and 782, respectively—all above the industry average for the big banks of 781. Tangerine ranked highest among midsize banks for the eighth year in a row, with a score of 827, considerably above the industry average of 798.