For the first time in a decade, no New Zealand bank qualified for Consumer NZ's People's Choice Award. The reason is not a single bad score but a broad pattern of customer dissatisfaction with banking value, pricing, and trust — with lower-income New Zealanders the most critical.
For the first time in a decade, no New Zealand bank has qualified for Consumer NZ's People's Choice Award — a mark given to service providers that score above average for customer satisfaction and meet other performance criteria. The outcome reflects not one catastrophic failure but a widespread and structural dissatisfaction with how banks treat their customers.
Consumer NZ found that 43 percent of customers believe bank profits are unacceptable. That figure is highest among lower-income New Zealanders, who are also the most likely to feel that everyday banking has not kept pace with what they expect.
What customers are unhappy about
The complaints are not confined to a single area. Consumer NZ CEO Jon Duffy said everyday banking has failed to meet customer expectations in multiple dimensions — specifically fees, interest rates, and how banks respond when something goes wrong. These are not new grievances. They have been present in various survey results for years. But the cumulative weight appears to have pushed satisfaction below the threshold needed for the People's Choice Award this time.
Westpac NZ ranked lowest among the banks in the Consumer NZ survey, placing last for responsible lending, value for money, timely responses, fees and charges, phone banking, branch banking, and the proportion of customers describing themselves as "very satisfied." The bank has been last or near last in multiple consecutive years. Westpac's managing director for consumer banking said the bank acknowledges the findings and is working to improve, noting recent gains in branch satisfaction and contact centre wait times.
The switching question
One of the more striking numbers in the survey is that only 4 percent of New Zealanders switched banks over the past year. That low figure is often cited by banks as evidence that customers are broadly satisfied — if they were not, the argument goes, they would vote with their feet. Duffy pushed back on that interpretation, saying the hassle of switching has been overstated as a barrier. He argued that consumer behaviour is what encourages competition, and that New Zealanders who keep an eye out for better deals and move when they find them create more options and leverage for everyone.
Kiwibank trailed other banks on trust, with 70 percent of its customers expressing trust in the institution — the lowest trust score among the banks surveyed.
What this means for the sector
The Consumer NZ result does not change bank balance sheets or regulatory obligations. But it does offer a snapshot of how customers feel about an industry that holds significant leverage over household finances. When dissatisfaction with banking value and trust is this broad and this consistent across multiple providers, it suggests the issues are structural rather than specific to one bank.
The Reserve Bank and Commerce Commission have both been examining competition in New Zealand banking in recent years. Low switching rates and high levels of customer dissatisfaction are inputs into those reviews. If the sector cannot address the underlying drivers of customer frustration, the policy conversation about whether more competition is needed may intensify.
This article is for general information only and is not personalised financial advice. Seek advice from a licensed financial adviser (registered on the FSPR) for guidance specific to your situation.