Small businesses less satisfied with Canadian banks than retail customers, study finds

TORONTO — Small businesses are less satisfied with Canada’s five largest banks than retail customers, says a J. D. Power and Associated study that ranked Scotiabank ( TSX: BNS) in top spot in terms of satisfaction among this key banking customer.

The inaugural Canadian small business banking satisfaction study found that overall satisfaction averaged 728 on a 1,000- point scale, 25 points below satisfaction among retail customers.

Respondents who ranked their bank poorly were more than three times more likely to switch banks.

That’s a potentially costly decision for financial institutions since small business customers have almost double the deposits of the average retail customer and four times higher loans.

“The in- person experience is extremely important to small businesses and banks need to get it right to maintain and grow these relationships,” said Jim Miller, senior director of banking at J. D. Power.

Scotiabank led the survey with a ranking of 733 points on the scale. It was followed by Royal Bank of Canada ( 725), TD Canada Trust ( 724), Bank of Montreal ( 711) and CIBC ( 689).

The study measured small business satisfaction in a number of categories: account activities, account manager, facility, fees, product offerings, account information, credit services and problem resolution.

It found that nearly twothirds of Canadian banks assign account managers to small business banking customers, compared with just half of U. S. banks.

Yet satisfaction was dragged down severely among small business customer who found their account manager fell short of expectations.