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Consumers' don’t trust their bank'

Amanda Jarvis

May 4, 2006

-46% of consumers do not trust their bank.
– 79% of consumers do not have payment protection insurance with their mortgage.
– 83% of consumers feel lenders should be more responsible with the amount they lend.
– 52% of consumers do not feel they are savings enough towards their retirement.
– 58% of consumers think branch-based banking will disappear in the future.

Emma Butler, moneyfacts.co.uk editor, commented:

Banks not trusted
“46% of consumers not trusting their bank is not a surprise. It is not often banks get positive PR. However, the reasons behind this lack of trust may be concerning. With people increasingly voicing their dissatisfaction, banks are being forced to make changes to the way in which they work – such as the recent decision by Lloyds TSB to pay instant interest on cheque payments. Over half of consumer thinking branch-based banking will become a thing of the past could be down to the amount of branches that have been closed in recent years, or due to the fact that alternative means of banking, such as telephone and internet, are becoming and will continue to become increasingly popular.”

Mortgage Protection only one in five have cover
“It is quite worrying that 79% of consumers do not have payment protection insurance for their mortgage. With people borrowing more it is unlikely that any state benefits would cover mortgage repayments if people were unable to work due to illness or redundancy. This insurance is not usually compulsory when taking out a mortgage but is something that people should consider seriously.”

Pensions
“Over half of consumers not feeling they are saving enough towards their retirement is a cause for concern and representative of the current ‘live for today’ culture in the UK. With recent regulations looking at simplifying these rarely understood products, it will be interesting to see if this has a positive effect on people’s attitude towards pension saving. The likelihood is that people will not save more, either due to lack of spare funds, wanting to use money for other things or lack of understanding, and that this will not change unless some form of enforced pension saving is introduced.”


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