UAE Banking: Record positive annual growth, score low on customer satisfaction

Customer service is one of the biggest pain points in retail banking, the UAE Banking Sentiment Index conducted by KPMG in partnership with DataEQ, has revealed. Despite a marginal improvement in Net Sentiment from the 2021 study, the UAE banking industry still has a way to go before it can meet consumer expectations.

The Index, based on 172,588 retrieved public tweets from 1 January to 31 December 2021, found that consumer conversation around UAE banking was prominently driven by operational issues, including lack of timely support provided by bank staff, long wait times and a lack of feedback. Service disruption was also a major challenge across the industry as consumers were unable to use banks’ mobile apps and complained of issues using online banking services.

The study also found that a third of all online conversations about banks required a response, however, on average 69% of priority tweets received a public response, leaving 31% of tweets unanswered. On a positive note, the average time it took the banks to respond was 10 hours, which was an improvement from the response time of 13 hours reported in the 2021 study.

Nic Ray, Chief Executive Officer, DataEQ, said, “With customers increasingly preferring to use digital channels for engagement with their bank, there is an opportunity to mine this valuable unstructured feedback for real-time insight, and importantly, an obligation to deliver effective, fair and compliant customer service on these channels.”

Debit cards, credit cards, and loan solutions had the highest negative Net Sentiment. In addition to complaints about fees related to these products, some consumers were frustrated by slow delivery of issued cards and delayed activations. There were also frequent complaints of the debit cards not working without a previous warning.

Despite these shortcomings, the UAE banking sector registered a promising year, with the top ten UAE banks reporting a 5% year-on-year increase in total assets to AED 2,989 billion in 2021, and a large increase of 42% in their net profits.

Abbas Basrai, Partner and Head of Financial Services, KPMG Lower Gulf, said, “This year’s edition of the Index shows that UAE retail banks must do more to address customer feedback and grievances to boost overall satisfaction levels. It isn’t enough to invest in digitalization; banks must rely on a data-driven approach which will result in better accuracy, optimized operations, improved compliance and an enhanced customer experience. Banks must evaluate their responsiveness to priority conversations on social media and make it part of their wider customer care strategy – rather than relying on it as a marketing tool.”

Improved customer service may soon become a matter of regulatory compliance, following the Consumer Protection Regulation (CPR) rolled out by the Central Bank in February 2021. According to this, UAE banks will have to establish an independent and fair complaint resolution system to receive and address consumer complaints in the future. The new Financial Consumer Protection Regulatory Framework (FCPRF) provides a broad spectrum of appropriate behaviour and conduct expected of licensed financial institutions, including banks.