Consumer trust in financial services remains robust

A new survey shows that consumer trust in the financial services industry remains remarkably robust despite the banking crisis and global recession.

With an overall trust rating of 75.02, the Financial Services Research Forum's 2009 Trust Index, produced by Nottingham University Business School, finds that on average, respondents are more trusting of financial services institutions (FSIs), compared to organisations like the NHS and BBC who scored 53 and 61 respectively (full report attached) .

Brokers/advisers (81.67) receive the highest ratings on trust and trustworthiness, followed by investment companies (76.24), general insurers (75.98) and building societies (75.22). Banks (73.96), life insurance companies (72.69) and credit card companies (71.55) receive the lowest ratings.

Professor Nigel Waite, Director, Financial Services Research Forum, said: "It has been widely assumed that the combined effects of the credit crunch, global recession and the banking crises would lead to a crisis in consumer trust in financial services. It may be an inconvenient truth, but the reality is that trust in the financial services industry is not at rock bottom.

"However, evidence showing that current conditions have not provoked a ‘crisis of trust' is not grounds for complacency. Behind an overall average that suggests consumers have moderate levels of trust in financial services providers, there is considerable variability. And average industry figures hide a wide disparity in trust for individual institutions within specific sectors."

The 2009 Trust Index is based on 1400 consumer interviews, and is the most recent piece of research from the Financial Services Research Forum, based at Nottingham University Business School. The research is the first of its kind to look past simple yes and no answers to develop a more complete understanding of consumer trust, by looking at base level (cognitive) and high level (affective) trust.

Base level (cognitive) trust is significantly above high level (affective) trust as might be expected - respondents are more convinced about the reliability/dependability of FSIs and less convinced about the extent to which FSIs have their interests at heart.

Professor Waite added: "Enduring relationships must be founded on high levels of trust. And, if industry and government are to enhance consumer engagement with financial services, there is still significant work to be done in terms of developing trust and trustworthiness.

"But, if the research tells us one thing, it is that the Government and regulator must move the debate surrounding the future of financial services onto a more constructive footing. Significant levels of consumer trust do exist, which should serve as a foundation on which to alleviate the current economic crisis."