EY’s Bank Relevance Index (BRI) calculated for Romania is 73.4 percent, by almost 2 percent less than the global average of 75.1 percent, a press release informs on Wednesday.
“The global banking industry faces new challenges from disruptive bank alternatives, creating a pivotal opportunity to regain relevance with customers. With the emergence of new competitors offering easy, personalized, trusted products, traditional banks’ connection with their customers is fragile. Banks must strengthen their relevance with the disruptive and convenient products customers want, while striving to rebuild the trust that was once an intrinsic component of the relationship,” the analysis’ authors say.
In Romania, the banks are “below customers’ expectations in the planning of future products and on current mix of the held products.”
Banks relevance is lower among young people aged between 18 and 34 years, 71.8 percent respectively. The importance of credit institutions is lower for low-income Romanians, while the banks are 100 percent relevant to customers with high incomes of over USD 100,000 per year.
Many Romanian have done important steps on insurance segment, reloadable prepaid cards and investment accounts. By contrast, the banks remain strong in terms of savings accounts, mortgages and current accounts.
To measure the state of bank relevance, EY surveyed more than 55,000 consumers around the world as part of our 2016 Global Consumer Banking Relevance campaign to produce the Bank Relevance Index (BRI). The BRI measures a range of current and future behaviors and attitudes to build a composite score on the basis of: how customers use banks now and how customers want to use banks in the future.
Results for individual countries suggest priority actions for banks in each market. For example, in Spain, Greece and Italy the main focus should be on trust, while in India, Mexico and Brazil the key to success is deepening the relationship with consumers and reaching the unbanked population.
In South Africa and Nigeria, findings show that despite higher trust levels, consumers are not using traditional banks to buy new products and services – severely diminishing overall bank relevance in these markets.
The 23-point differential across the 32 countries included in the index shows that the struggle to stay relevant varies by market.
The Nordics Region had the highest bank relevance scores and ranked above the global average; Finland was at the top at 82.7. Germany and Switzerland also ranked highly, with greater rates of “complete trust” than other countries for traditional banks.
Asian banks are more vulnerable to decreasing relevance, as demonstrated by low scores in Indonesia (66.9), China (69.5) and India (71.1), likely due to the prevalence of mobile and nontraditional banking options and the evolving “unbanked” population. EY research also found that more than 12 percent of consumers in Hong Kong and 6 percent in Singapore already name a nontraditional bank as their primary financial service provider.