New Report: The Best Online Banks for Customer Satisfaction

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If you’re looking for a new bank, one really good indicator of whether you’ll be happy or not is how its current customers feel about it.

Money expert Clark Howard has long been a big fan of online banks, evangelizing their many benefits over traditional banks. A new report backs up Clark’s sentiments.

The J.D. Power 2020 U.S. Direct Banking Satisfaction Study shows which financial institutions get high marks from people who bank with them.

Here are key some findings from the report, which essentially defines direct banks as those that offer services remotely or virtually:

  • Charles Schwab Bank is tops in overall satisfaction among direct banks for the second straight year
  • E*TRADE Bank lands #2 in the rankings, while other banks ranked below the industry average

The study, now in its fourth year, is based on responses conducted in December 2019-January 2020 from 3,147 direct bank customers. The scores are based on a 1,000-point scale.

Here are the direct banks customers are most happy with, according to J.D. Power:

Customers: These Are the Best Direct Banks in 2020

Charles Schwab Bank 875
E*TRADE Bank 869
Industry Average 864
Discover Bank 863
Capital One 854
Ally Bank 853
State Farm Bank 843
TIAA Bank 802
Axos Bank 782
USAA (brand not eligible; does not meet study award criteria) 887

Although the findings of the study show that direct banks generally outperform traditional banks, the former has some issues when it comes to call center communications.

“While direct banks are delivering high customer satisfaction they have challenges in key areas such as call center operations, new client onboarding and consistent digital engagement,” said Bob Neuhaus, vice president of financial services intelligence at J.D. Power.

Neuhaus said the global health crisis makes customer interaction that much more important these days.

“Getting the formula right on customer service and client communications will be particularly important as direct banks contend with the fallout of the COVID-19 pandemic in terms of account servicing and a significantly lower interest rate environment,” he added.

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Interested in digital banking without all the junk fees? Learn more about the best online banks here.



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