Can Santander sort itself out?

by Ed Bowsher on 24 September 2010  |  10 comments
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Santander is trying to improve its reputation for rotten customer service. Can it turn things around?

At the risk of sounding nerdish, I’m fascinated by the recent history of Santander in the UK.  The British banking market has been dominated by four big players for way too long, so it’s really interesting to watch Santander’s attempt to shake things up and become the fifth major player.

Santander’s growth has mainly come via acquisition but the Spanish bank is also attempting to gain market share by offering some attractive products. For example, I really like Santander’s current accounts. The Santander Preferred In-Credit Rate current account pays 5% interest on  balances up to £2500 in the first year as long as you pay in at least £1000 a month. You’ll also get £100 cashback when you sign up.

Trouble is, Santander has a rotten reputation for customer service. I know that two lovemoney.com employees have had poor experiences with the bank and many readers have told us they’ve had a rough time. Here’s just one example from a comment on the bottom of one of our articles:

“It is common knowledge that in spite of them being one of the largest, Santander is probably the worst banking presence ever to hit the UK High Streets. Their customer-service is rubbish...”

In fairness to Santander, it’s aware that it has a problem. Back in July it recruited 600 people to boost up its staff levels in branches. And now today it’s announced that it’s going to add 400 people to its workforce in UK call centres.

So the question is: can the extra staff improve the customer service? And can customer service be improved without adding significantly to the bank’s cost base?

Santander claims that it’s “the most efficient UK bank.” I suspect it’s going to be hard to maintain that position if customer service is to be improved. I’ll keep watching....