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    The Big Problem With Banks—and What to Do About It

    Poor customer service, common with online-only banks, may now be hitting brick-and-mortar banks. CR explains how to get your bank’s attention.

    illustration of bank with dollar bill and digital devices around it Illustration: Israel Vargas

    Complaints about poor customer service, which usually have targeted online-only banks, are now hitting brick-and-mortar institutions.

    Many big banks have been cutting costs in recent years, which often means fewer branches and fewer people to take care of consumers’ needs. 

    “I am so tired of bank mergers. What a pain and inconvenience,” Mabel Seyfried from Stony Run, Pa., told Consumer Reports. “I live very rural and there are no banking branches near me. I lost count of how many branches have closed and leave me traveling farther and farther when I need cash.”

    More on Banking and Personal Finance

    Seyfried was among some 350 people who responded to CR’s request for members to share their customer service experiences with big banks. Hundreds more responded to a forum over the summer that was organized by the Consumer Finance Protection Bureau, which has supervisory authority over large banks, thrifts, and credit unions with assets over $10 billion, totaling roughly 175 banks.

    Banks where consumers can walk in and interact with human employees have long been thought to offer better customer service than online-only competitors which rely on non-human technology. But now, even banks with physical branches seem to be falling short on customer service, according to the CFPB, consumer advocates, and numerous customer complaints. 

    Some consumers, like Jane Fasullo, treasurer of the Suffolk County Math Teachers’ Association, from East Setauket, N.Y., complained about how long it took to have seemingly simple information changed or added to an account, even when going to the bank branch in person. 

    “When I had to have my name added to a business account, it took three days, the second of which lasted over an hour with two of us present to (supposedly) take care of everything.” she wrote.

    The other comments spanned a range of issues, including overly aggressive sales pitches for banking products, difficulties navigating automated call centers, a lack of disability accommodations at bank branches, and dwindling retail locations near elderly communities.

    Consumers in rural areas also expressed their frustration at the lack of branches and having to travel long distances to get access to in-person banking as well as the exceedingly long wait times they experienced once they reached a bank.

    While the majority of responses expressed dissatisfaction about the quality and accessibility of customer service at banks, they aren’t part of a nationally representative survey and only represent a small proportion of actual bank customers. 

    Technological Gap

    At the heart of the issue is a deepening reliance on technology by brick-and-mortar banks. Their algorithms monitor customers’ digital profiles and online activity in order to better market banking products, resolve financial issues, and evaluate their clients’ needs. In-person service (known as “relationship banking”), which has traditionally been how banks do business, is now only widely available to the wealthiest clients, says CFPB director Rohit Chopra.

    “At this point in the United States, ‘relationship banking’ is geared toward high-net-worth individuals who typically enjoy a wide range of banking services, often through local, regional, and national private wealth managers. For most households and small businesses, this kind of relationship banking is becoming harder to find,” he said during a speech in Montana.

    “Banking is becoming increasingly digitized, which is causing a number of challenges for consumers who prefer in-person banking,” says Syed Ejaz, a Consumer Reports financial policy analyst. “The COVID-19 pandemic has only accelerated this as many banks shut down their retail locations, leaving consumers with no option but to bank online or over the phone,” he adds. 

    Even when banks continue to maintain branches, consumers, advocates, and the CFPB say they’re reducing the staff that’s available for in-person service, leaving most customers to deal with apps or call centers to do the bulk of their banking, and providing worsening service. 

    The problem with bad customer service from financial institutions became glaringly evident in 2021, particularly with online banks. Chime, one of the most popular online banks was pummeled in the press last year after reports surfaced that an AI algorithm it used had suddenly frozen some customers’ accounts after incorrectly detecting fraudulent activity. Those customers then were unable to reach a customer service representative to help them and lost access to their money for months, despite repeatedly trying to connect with a representative.

    Following the reports, Chime said it would improve its customer service options. Chime Member Services can now be reached by phone 24 hours a day, seven days a week or by email, live chat, in-app messaging, and by direct message on social media.

    Now Chopra says the CFPB wants to ensure that big banks aren’t similarly failing to provide customer service in a timely manner by “sending people through call center mazes in order to get them to give up on asking for help with their account.” 

    In a letter sent to the CFPB, the American Bankers Association, Bank Policy Institute, and Consumer Bankers Association, disputed the assertions of worsening customer service. 

    “The CFPB’s statements unfairly characterize the quality of customer service provided by banks and appear to reflect the CFPB’s predetermined conclusions that banks do not provide high-quality customer service. This approach is unhelpful to consumers as they navigate the financial services marketplace and is likely to confuse them,” the bank industry groups wrote.

    In the letter, the bankers groups also pointed to the CFPB’s own research (PDF) into mortgage servicing wait times, which the group says affirms that banks provide “outstanding” customer service. 

    “A CFPB analysis found that, during the COVID-19 pandemic, mortgage borrowers waited on average less than 3 minutes to speak with a representative from the moment the call entered the servicer’s interactive voice response system. “These short wait times are particularly impressive in light of the complicated nature of mortgage servicing calls, which often require lengthy conversations between borrower and servicer,” the groups wrote.

    The bankers also pointed to their own recent polling data. An ABA October 2021 survey shows that 97 percent of customers rank their bank’s customer service as “excellent,” “very good,” or “good.” A February 2022 ABA/Morning Consult survey found that 9 in 10 Americans with a bank account (89 percent) say they are “very satisfied” or “satisfied” with their primary bank, and 88 percent agree they have multiple options when selecting products and services such as bank accounts, loans, and credit cards. 

    Meanwhile, as banks and regulators hash out where the problems lie, who’s responsible, and how to resolve them, here are some tips to help you get through to someone if you’re unable to get your problem resolved by a bank representative.

    Contact the CEO’s Office

    Don’t expect to get the CEO’s direct phone number or email address. But you can probably find the company’s main number online. Once you get someone on the line, follow these steps, says Shep Hyken, a customer service expert who works with companies to build loyal customer relationships.

    • Don’t ask to speak to the CEO directly. Instead, ask to speak to the office of the CEO. The chief executive has a team to take care of problems, so most of the time, somebody will respond.
    • Introduce yourself and use this script: Hi, my name is ____. Originally I wanted to talk to (the CEO’s name), but I thought I would just speak to somebody in their office. Maybe you can help me with this problem.
    • Explain your situation. But no matter how frustrated and angry you might be, it’s important to be nice. Don’t put the person on the defensive; you want them on your side. If they’re properly trained or they understand the situation, they’ll show you empathy and help you with your problem.

    Use Social Media—the Right Way

    Some people rant on social media even before they pick up the phone. That’s because they feel it’s the quickest way to get attention. However, Hyken recommends that you take a less confrontational approach—especially if it’s your first attempt to reach the company.

    • Send a direct message to the company on Twitter instead of a public tweet. “Give the company the opportunity to fix the issue before you make a scene on social media,” Hyken says. “When a company sees you’re direct messaging them through a social channel, they know you have the ability to not direct message them, and sometimes they appreciate that you did it this way,” he adds. “It may elicit a quicker, more helpful response.”
    • Sending a direct message also helps you avoid scams. Some fraudsters may respond to your public tweet by saying they’re a company representative when all they’re trying to do is steal your money.
    • Don’t threaten the company in your DM. Simply say, “I thought the best way to reach you would be through social media, and I thought, even better would be to direct message you, so I can get a quicker response,” Hyken says.
    • Don’t plan on getting an immediate response. “Expect a response within a day or so,” Hyken says.

    Report a Problem to the Better Business Bureau

    Although the BBB may not have the teeth to force a company to resolve an issue, being considered a good or bad company by the BBB carries a lot of weight in the marketplace.

    If you feel that you’ve gotten bad service, make sure to report it to the BBB. And before you choose a service, it’s always a good habit to check the BBB website to see what consumers are saying about the company you’re planning to use.

    Contact Regulators

    The Consumer Financial Protection Bureau is in charge of enforcing banking and fintech consumer fairness practices. Consumers who feel wronged by their financial institution—whether it’s a fintech start-up or a traditional brick-and-mortar financial services company—can file a complaint using the Consumer Complaint Database or by calling 855-411-2372. 

    “Companies have provided timely responses to 98 percent of the more than 2.4 million complaints sent to them for response since the CFPB began accepting complaints in 2011,” says Raul Cisneros, a public affairs specialist with the CFPB.

    Before you get started, here are some of the things you’ll need to file your complaint: 

    • Dates, amounts, documents, and other details about your complaint. Make sure to scan your documents beforehand so that they can be easily attached to the digital file you create.
    • Include all the information you can, because you generally can’t submit a second complaint about the same problem, according to the CFPB.
    • The CFPB will forward your complaint and any documents you provide to the company and work to get you a response—generally within 15 days.
    • If the CFPB finds that another government agency would be better able to assist, it will forward your complaint to it and let you know.
    • If the CFPB complaint doesn’t result in any response from the company, you should also contact your state’s attorney general’s office. California residents can also file complaints with the California Department of Financial Protection and Innovation.

    Switch Banks

    If you’re unhappy with a bank’s customer service, simply close your account and go elsewhere. “With some of these digital companies, if I can’t reach human help, when the issue is over, as soon as I find a way, I’d switch,” says Hyken.

    But closing a financial account presents its own headaches.

    “You’ve got to close an account and then open another account, and sometimes the path of least resistance is to just put up with it,” Hyken says. “But consumers are getting smarter today, and their expectations are higher. Companies out there that aren’t responding appropriately or aren’t responding in a timely matter, or don’t have a way to get to a human, should consider this a warning,” Hyken says.


    Image of Octavio Blanco, editor at CR with Money CIA

    Octavio Blanco

    My mission: To write stories that broaden readers' horizons and offer new solutions they can apply to their lives. Who I write for: My family, my friends, my neighbors, myself, and—most important—you. My passions: Music, art, coffee, cheese, good TV, and riding my electric bike.