More Americans report feeling the effects of inflation and increasingly are turning to banks for help, according to a J.D. Power survey released today.
Nearly three-fourths (72%) of Americans said the cost of goods is increasing faster than their income—up 2% since June, which was an all-time high. Retail bank customers classified as financially healthy dropped to an all-time low of 30%, while the proportion of those falling into the financially vulnerable category rose by six percentage points to 45%, the survey reported.
Bracing for recession, one-third of customers are waiting for assistance from their banks, the survey said, with 81% reporting that bank support is important to help them manage living with high inflation, which includes 91% of overextended customers. Asked if banks had reached out with information on how to handle inflation, 31% reported receiving some form of communication. Another 31% said they had not but wish they had.
Retail banks’ environmental, social and governance performance also has come under greater scrutiny as bank customers navigate an increasingly challenging economy, the survey noted. One in five Americans (20%) said they have left their bank because of its corporate social governance policies, and 16% have said the same about their credit card issuer. ESG initiatives may not be the determining factor for most, but there has been a shift in how bank customers view their financial institutions, according to survey authors. “Americans no longer want their banks to have a passive role in their finances, nor do they want to be tied to corporations that are disengaged from their communities,” analysts noted.
