When it comes to retaining customers, few businesses have had it easier than Canada’s big six banks. According to a 2014 Google consumer survey, just 14 percent of Canadians changed banks in the past year. This type of sticky relationship is due in part to inertia – many of us become customers for life after opening our first bank account, and the very idea of switching banks is too much of a hassle to even consider.
Related: Does your bank deserve your loyalty?
That’s not to say the big banks have earned that kind of loyalty. TD recently hiked fees on its chequing accounts and increased the minimum balance needed to waive those fees. Not to be outdone, BMO announced similar changes that take effect May 1st, 2015.
350 Reasons to Switch Banking
I can be loyal to a degree, but not to a fault. I’ll admit I’m a sucker for a great deal, and I’m not afraid to shake-up my daily routine in order to take advantage of a sweet promotion.
It’s been years since I’ve made a drastic banking change, but earlier this month I saw a promotion that not only made me take notice, it made me take action:
I let that sink in for a while and considered my options. Then I remembered that a co-worker banked with ATB and so I quizzed him on his banking relationship. He not only gave the bank a positive review, he was able to take advantage of the promotion as well – collecting $150 cash for referring me to ATB.
Convinced that I made a great decision, I called up the closest ATB branch that afternoon and made an appointment to open an account. Once I got to the branch, it took about 25 minutes to get everything set up – including online banking and getting a debit card.
I chose the basic account, which costs $3.95 per month and includes 15 transactions. An added bonus is access to ATB’s new TrackIt money management tool that allows you to pull all of your bank accounts, credit cards, investment accounts, and even gift cards into one place so you can see your balances and spending. It’s like Mint.com, but without the potential of violating your banking agreement.
To take advantage of the $350 promotional offer I had to add direct deposit or set-up two automatic preauthorized payments with the first ones charged through the new account by July 31, 2015.
What is typically a pain-point for many customers was actually quite simple. At the end of the meeting, I was handed a direct deposit form with the new account information listed. I could take that to my employer to switch my payroll, and/or use it to set-up the preauthorized payments.
Tip: ATB also has a free service called eSwitch that does all the legwork for you.
I chose the preauthorized payment route and picked two bills that don’t offer the option to pay by credit card: Enmax, for natural gas and electricity, and Wawanesa for car insurance. The Enmax pre-authorization was literally changed online in seconds, while switching the car insurance payment simply required an email to my broker with the new account information. Done and done.
Once the preauthorized payments have gone through for three consecutive months then I’ll get $350 and my co-worker will get $150.
Banks will have to get more creative in order to preserve customer loyalty with changing demographics and an increasingly competitive landscape. Indeed, the Gen-Yer’s surveyed were 1.5 times more likely to change banks or consider changing banks as the rest of the population.
Related: What’s in your wallet?
The bottom line for consumers is that your loyalty shouldn’t come free. Don’t be complacent and just blindly accept bad service or annual fee increases without shopping around from time-to-time to compare what’s available. You might be surprised to find a great deal waiting for you.