|A new study shows that consumers trust the banking industry the least.|
The study was generated by Edelman Insights. The data was collected not just in the U.S., but also from bank consumers in 25 countries across the globe.
Pretty much across the board, global financial consumers view banks dimly, with a significant "decline in trust," Edelman reports. "Once again, banks and financial services declined in trust, and were the two least trusted sectors with France, Spain, Brazil, Japan, and South Korea recording the most severe drops," the study says. "Technology remained the most trusted sector globally." One of the world's least trusted institutions - the media - saw an increase in trust from consumers, interestingly from what survey respondents said was a good job in reporting on the worldwide financial crisis, especially in Europe. "As the media landscape dimensionalizes and delivers a wider range of options, it is becoming more trusted," offers Alan VanderMolen, President and CEO at Edelman in a statement. "The media also did an exceptional job this past year of covering the financial problems throughout the EU." The survey actually splits the financial sector in two, with "banks" (at 47% in terms of consumer trust) and "financial services" (45%) at the very bottom of the study's scale. Edelman says that consumer perceptions of global institutions very much depends on where people live - and how things are going regionally. Japan, for example, suffered a devastating earthquake and tsunami last spring, and that hangover has soured the perceptions of industries overall in the country. Consumer trust in Japan fell 20% on banks; 46% on energy; 21% on media; and 17% on financial services. South Korea, which was hit hard during the global recession, saw a 25 percentage point decline in trust in financial services year over year from 64% to 39%.
Edelman's research reveals a few gateways that banks could be opening to regain that consumer trust - direct contact between consumers and bank staff and open communication channels via social networks (especially Facebook and Twitter). Banks would do well to focus on those areas if they're serious about regaining consumer trust.