Challenger banks appear to not only be the ones offering the best rates at the moment, but also those that savers trust the most. That's according to new findings from Hampshire Trust Bank, which show that 63% of customers now trust challenger brands more than the big five high street banks.
Given that conventional wisdom suggests consumers trust brands they are more familiar with and are likelier to give them custom – which is probably why the big brands haven't needed to up their rates much in the last few years – this new finding could indicate that more people are now familiar with these brands. Alternatively, they could be getting used to investing with lesser-known providers for the sake of a higher return.
"In the highly competitive banking sector, we are accustomed to the challenger versus incumbent narrative, so it is extremely encouraging to hear from savers that challenger banks are trustworthy, specialist and relevant in this evolving landscape," Stuart Hulme, director of Savings at Hampshire Trust Bank, commented. "The results also show that trust in banking has improved since the dark days of 2008. This is arguably being driven by challenger banks."
With 71% of survey respondents stating that they still think cash savings are the most effective when considering their investment options over the next five years, compared to 15% who selected equities and 4% who chose property investments, it's important that these cash savers manage to find the best returns. Luckily, it appears the majority are not steering away from the lesser-known names or restricting themselves to the high street, which means the whole savings market is open for them to choose from.
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